Weekend Watch List: 3 Top Stocks With High Returns

Air Canada (TSX:AC)(TSX:AC.B) has seen its share price more than triple in the last three years, while two other stocks have seen comparable returns.

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The debut TSX 30 was announced last week, and there were some surprising winners. There were also some high-momentum favourites on the list: precious metals won big, while the cannabis industry not only took the top spot but several lower ones as well. However, here are two other winning sectors you might have missed.

Canadian aviation is well represented in the TSX 30

It’s certainly been an interesting year for Canadian aviation, with grounded jets impacting the industry and flight operators jostling for market share dominance. Nevertheless, three businesses linked to the industry made the TSX 30 list: a passenger airline, a freight business (Cargojet), and a human resources company.

The nation’s flag-carrying airline grew its share price by a massive 346% in the last three years, though mixed signals have left the stock flat this week. Notable news items swirling around Air Canada include the impact from a lack of 737 Max jets on summer flights and, more recently, the collapse of travel group Thomas Cook.

While the former situation saw Air Canada’s operational expertise tested on multiple levels, the latter development could potentially see Air Canada gain market share from rivals that had operations in place with the now-defunct Thomas Cook. Not that market share is an issue for the fast-appreciating Air Canada: The airline is Canada’s largest, carrying 51 million customers to hot spots on six continents last year.

While not an aviation stock per se, CAE provides training services for the civil aviation sector. Also active in the healthcare and defence industries, CAE is a world leader that sets a benchmark for training protocol, utilizing unique virtual-to-live training systems to increase aviation safety. Having seen its share price grow by 136% in the last three years, CAE nabbed the number 26 spot on the TSX 30.

Internet-based services also featured on the list

The internet is a key area of investment, whether it be services that operate through the cloud or the provision of broadband itself. Two stocks that made the cut in the inaugural TSX 30 list of best-in-class companies growing their share price rapidly over the past three-year period were Shopify and Tucows, representing the online services and internet provision sectors, respectively.

Tucows made the list at the 24th spot thanks to a 152% growth in share price over the last three years. With a global reach that accounts for high numbers of business partnerships as well as a large network of private customers, Tucows provides web hosting, ISP duties, and various other online products and services.

However, despite its high historical returns, first-time investors looking for the widest economic moats may want to pass on Tucows and stick with Telus. Low-risk investors with an interest in media exposure could alternatively consider stacking shares in Bell company parent BCE or sports media giant Rogers.

The bottom line

Air Canada is the dominant player in Canadian airlines, and its stock should continue to appreciate, offering new investors upside potential. CAE also looks like an interesting play for its diversification across three defensive sectors, while Tucows could continue to grow if the swirling market uncertainty blows over and the current record bull run continues.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Victoria Hetherington has no position in any of the stocks mentioned. The Motley Fool owns shares of CARGOJET INC., Shopify, Shopify, Tucows, and TUCOWS INC. CargoJet is a recommendation of Hidden Gems Canada.  Shopify and Tucows are recommendations of Stock Advisor Canada.

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