Vaccine distribution, expected economic expansion, increased e-commerce spending, and revival of demand is likely to provide a strong base for growth in 2021.
With that in the background, I have chosen the five best TSX stocks to buy now that are likely to deliver impressive returns in 2021. Besides, these stocks are trading under $100, implying that you don’t need a lot of money to invest in these top stocks.
Suncor Energy (TSX:SU)(NYSE:SU) is one of my top recovery bets. The economic reopening could drive demand for crude and support the uptrend in Suncor stock. I believe the oil prices could trend higher in 2021 despite the upward pressure from extensive global crude inventories.
I expect the demand to pick up pace in the second half of the year, once the vaccine is widely available. Further, Suncor’s lower cost base and integrated business model is encouraging and is likely to cushion its bottom line. The company’s operating losses could narrow down, while it is expected to maintain its dividend payouts. Suncor stock is down about 47% in one year and presents a good buying opportunity. Also, it offers a decent dividend yield of 3.9%.
goeasy (TSX:GSY) is expected to outperform its bigger rivals, including top Canadian banks. The uptick in economic activities could spur demand and drive its credit portfolio. With the easing of lockdown measures, the subprime lender has started to see an improvement in the loan origination rate and expects its loan portfolio to expand.
With expected improvement in demand, new product launches, channel expansion, and cost-savings, goeasy is likely to deliver strong earnings growth in 2021, which is likely to lift its stock higher. Also, the company is expected to boost its shareholders’ returns through higher dividend payments.
The uptrend in Lightspeed POS (TSX:LSPD)(NYSE:LSPD) stock is likely to sustain in 2021, thanks to the strong secular tailwinds. I believe the spending on e-commerce is likely to increase in 2021, while small and medium-sized businesses will continue to shift towards the omnichannel payment platform, which is likely to drive its revenues and support margins.
Lightspeed’s focus on innovation, up-selling, and geographic expansion positions it well to capitalize on the growing demand. Meanwhile, its recent acquisitions and continued increase in customer locations are expected to accelerate its growth.
Similar to Lightspeed, Goodfood Market (TSX:FOOD) stock is expected to benefit from strong sectoral tailwinds. The increased adoption of online grocery services and expansion of its delivery capabilities provides a strong underpinning for growth.
The company’s active subscriber base continues to grow at a healthy pace, reflecting increased demand. Meanwhile, its expanded product offerings and last-mile delivery capabilities continue to drive its market share. Also, the rollout of same-day delivery services augurs well for growth.
Dye & Durham
Dye & Durham (TSX:DND) stock has witnessed a sharp selloff in the recent past and is down about 22% in January 2021. I believe the pullback in DND stock is an excellent opportunity to buy this high growth stock.
I believe the easing of lockdown measures and an uptick in economic activities are likely to drive demand for Dye Durham’s products and services. Meanwhile, Dye & Durham’s recent acquisitions are expected to accelerate its revenue and EBITDA growth. The company’s strong client base, accretive acquisitions, and long-term contracts with top customers are likely to drive its financials, in turn, its stock.
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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool owns shares of Lightspeed POS Inc. The Motley Fool recommends Goodfood Market.