MENU

Growth Investors: 3 Diverse Stocks That Have Outperformed the TSX This Year

Up until recently, the TSX has been performing poorly, and year-to-date returns are still barely 3%, so investors would be forgiven for not wanting to mirror the returns of the market. The biggest danger with too much diversification is that your returns could follow the market, and if it isn’t doing that well, your returns won’t be any better. For that reason, I’ve highlighted three stocks below that have been high performers this year and that could still be great buys today.

Air Canada  (TSX:AC)(TSX:AC.B) has seen record numbers this year on its financials and in its share price. Year to date, the stock has nearly doubled, and its share price reached a new all-time high of $27.68 in September. Since then, the stock has dropped, but it still trades at close to $27 a share. At a price-to-earnings ratio of less than nine, the stock is still a good value investment, despite its incredible ascent. Air Canada’s shares are a bargain compared to competitor WestJet Airlines Ltd.  (TSX:WJA), which trades at 12 times its earnings.

The airline saw revenues rise 13% in its last quarter and net income of $300 million was up 61% year over year. Air Canada has benefited from a dropping price of oil over the years, and if that trend continues, or at least doesn’t reverse, the company’s bottom line will continue to benefit. With the economy growing, Air Canada might still see a rise in passengers and continue to make new records.

Spin Master Corp.’s (TSX:TOY) share price has also seen terrific returns of over 50% in 2017, as the stock got a big bump when it released its latest earnings back in August. In that quarter, the company saw its sales rise 54% from the previous year, while profits had a 514% increase. Spin Master has seen strong growth over the years, and with sales of over $1.1 billion in 2016, the company’s top line has more than doubled in just three years.

The company behind the PAW Patrol television series and the hit toy Hatchimals has shown that it is able to innovate and create brands that will grow sales. Back in August, the company announced that it would be expanding its products into China, which could mean even stronger growth opportunities ahead as it extends its reach into the world’s largest economy.

Canfor Corporation  (TSX:CFP) might have been expected to see a tough year with softwood lumber discussions taking place with a U.S. government that is taking a protectionist approach to its economy. However, Canfor’s stock has been doing very well with its share price rising over 50% in 2017.

The U.S. has already slapped Canfor and West Fraser Timber Co. Ltd.  (TSX:WFT) with hefty duties while the softwood negotiations continue, but that has not had a negative impact on the share price, and we may not see any until the duties are finalized. However, with severe hurricane damage across the U.S., demand for lumber will be very high, and it may shift some leverage back to Canada during negotiations.

As home repairs and reconstructions take place, companies like Canfor might see a significant growth in sales in the coming quarters.

The Next Canadian Superbrand You’ve Never Heard of...

This small-cap stock is “Hidden in Plain Sight!” It’s flying under the radar and is being touted as a “royalty collector” by several of our top Canadian analysts.

Right now you aren’t on the list to receive our formal “buy recommendation”, so don’t delay – simply click here to enter your email address and discover how you can access the exclusive report.

Fool contributor David Jagielski has no position in any stocks mentioned. 

I consent to receiving information from The Motley Fool via email, direct mail, and occasional special offer phone calls. I understand I can unsubscribe from these updates at any time. Please read the Privacy Statement and Terms of Service for more information.