The Motley Fool

Top Canadian Stocks: Here Are the 3 Biggest Winners of the Pandemic

Image source: Getty Images

Some have described the ongoing coronavirus outbreak as a “once-in-a-century crisis,” while many termed it the “black swan.” Irrespective of the narrative, the pandemic has indeed gobbled years of the global economic growth. However, some companies have significantly benefited from the pandemic and accelerated in the last few months. Let’s take a look at three such top Canadian stocks.

Shopify

Shopify (TSX:SHOP)(NYSE:SHOP) is undoubtedly one of the biggest winners of the coronavirus crisis. The tech giant witnessed a huge demand surge for its platform amid travel restrictions and lockdowns. Its revenue growth almost doubled in the second quarter compared to the same period last year.

This financial growth was very well reflected in its market performance as well. Shopify stock surged to its all-time high of $1,502 earlier this month, marking a more than 190% gain in 2020.

However, the stock has trended lower since then and is currently trading close to $1,166 levels. That’s a 22% correction in just two weeks.

Investors should note that the pandemic will likely have a prolonged impact on consumer behaviour, which will continue to boost Shopify. The online store enabler Shopify still has a large market to serve and has attractive growth prospects. The recent weakness is an attractive opportunity for long-term investors.

Cargojet

Air cargo operator Cargojet (TSX:CJT) also sported superior revenue growth in the first half of 2020, thrashing pandemic worries. The stock has soared more than 80% this year. Canadian stocks at large are trading roughly 10% lower compared to the end of 2019.

Cargojet mainly generates its revenues from its air cargo services between 14 major Canadian cities. It runs 29 aircraft and moves over 1.8 million pounds of time-sensitive air cargo each business night.

Cargojet’s scale and unmatched network are big advantages that make it stand tall in the industry. The e-commerce market in Canada is still an underpenetrated market compared to the U.S. and U.K.

Thus, Cargojet has a huge growth potential given the booming e-commerce sector and the stay-at-home culture.

Cargojet stock looks overvalued after such a steep rally. Conservative investors can wait for a pullback or can consider buying in tranches.

Goodfood Market

Goodfood Market (TSX:FOOD) is another Canadian stock that witnessed substantial growth during the pandemic. It has more than tripled since its record lows in March amid the epic crash.

Goodfood Market saw its subscriber base increase significantly during the peak of lockdown in the second quarter of 2020. It’s a meal-kit company that delivers fresh meal ingredients to its subscribers.

The company management expects the current swing in consumer behaviour will have an extended positive impact on its demand. Notably, a larger subscriber base and higher profit margins could play very well for its earnings growth.

Goodfood Market stock has fallen almost 30% since its second-quarter earnings in August. The stock looks attractively valued after the correction and looks poised to soar higher. It is a relatively smaller stock and could be more volatile than Canadian stocks on average. However, it looks like an interesting play that’s worth the risk.

Where should you invest $1,000 today?

The 10 Best Stocks to Buy This Month

Renowned Canadian investor Iain Butler just named 10 stocks for Canadians to buy TODAY. So if you’re tired of reading about other people getting rich in the stock market, this might be a good day for you.
Because Motley Fool Canada is offering a full 65% off the list price of their top stock-picking service, plus a complete membership fee back guarantee on what you pay for the service. Simply click here to discover how you can take advantage of this.

Click Here to Learn More Today!

Fool contributor Vineet Kulkarni has no position in any of the stocks mentioned. Tom Gardner owns shares of Shopify. The Motley Fool owns shares of and recommends CARGOJET INC., Shopify, and Shopify. The Motley Fool recommends Goodfood Market.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss an important event.

Iain Butler and the Stock Advisor Canada team only publish their new “buy alerts” twice a month, and only to an exclusively small group.

This is your chance to get in early on what could prove to be very special investment advice.

Enter your email address below to get started now, and join the other thousands of Canadians who have already signed up for their chance to get the market-beating advice from Stock Advisor Canada.

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.