Got $1,000? 4 Top Canadian Stocks to Buy Right Now

Given their high-growth prospects, these four Canadian stocks can deliver superior returns this year.

| More on:
TIMER SAYING TIME FOR ACTION

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

Despite rising volatility, I expect the uptrend in the Canadian equity markets to continue amid demand recovery and improvement in corporate earnings. So, here are four top Canadian stocks you can buy right now to earn superior returns this year.

Nuvei

Nuvei (TSX:NVEI) is a global payment technology partner, which operates across 200 markets and supports 455 different payment modes. Its proprietary platform allows its partners and merchants to accept payments in over 150 currencies and 40 cryptocurrencies securely. Supported by its product offerings and capabilities, the company had reported an impressive fourth-quarter performance. Its top line grew over 40%, while its adjusted EBITDA grew more than 50%.

Nuvei’s strong performance has boosted its stock price, which trades over 160% higher since going public in September 2020. Meanwhile, I believe the uptrend in the company’s stock price to continue given the structural shift towards online shopping and its significant exposure to the iGaming and sports betting industry, which offers high-growth prospects amid increased legalization. The company is also working on closing the acquisition of Mazooma Technical Service, a U.S.-focused sports betting, payment platform provider.

goeasy

goeasy (TSX:GSY) has delivered a substantial performance over the last 20 years, with its normalized diluted EPS growing at a CAGR of 24.9%. Supported by its strong fundamentals, the company has returned close to 1,600% over the last 10 years. Despite its impressive stock price growth, the company is still trading at an attractive valuation, with its forward price-to-earnings ratio standing at 15.1.

Amid the improvement in economic activities and economic expansion, the demand for the company’s services could rise going forward. Meanwhile, through its wide range of financial products, omnichannel distribution model, and increased penetration, the company is well equipped to benefit from the expanding addressable market. The recent acquisition of LendCare Holdings has expanded its product range and added new industry verticals. So, given its high-growth prospects and attractive valuation, I expect goeasy to deliver superior returns this year.

Air Canada

The passenger airline industry is going through a challenging period amid the pandemic-infused travel restrictions. Air Canada (TSX:AC), the largest airline in Canada, has also felt the brunt, with its 2020 net losses coming at $4.65 billion while burning $4.67 billion of net cash. Higher net losses and rising debt levels have weighed heavily on its stock price, which is down 49% from its January 2020 levels.

Despite the near-term weakness, the company’s long-term outlook looks healthy. The widespread vaccination could allow the government to lift some of the harsh restrictions, boosting passenger demand. The company is also looking at expanding its cargo vertical to meet the increased demand.

Meanwhile, the financial support of $5.9 billion from the government has strengthened its balance sheet. Further, the company’s cost-cutting initiatives could lower its losses in the near term. Given its scale and strong balance sheet, I believe Air Canada could bounce back strongly in the second half of this year.

Suncor Energy

The final pick on my list is Suncor Energy (TSX:SU)(NYSE:SU), which had reported an impressive first-quarter performance on Monday, outperforming analysts’ expectations. Its net earnings came in at $821 million against analysts’ expectation of $232 million and a significant improvement from a net loss of $3.5 billion in the previous year’s quarter. The increased production and higher oil prices boosted the company’s financials.

Oil prices have bounced back strongly, with West Texas Intermediate (WTI) oil trading above $65 per barrel. Industry experts project oil prices to remain at elevated levels for the rest of this year amid improvement in economic activities. Further, its production is expected to rise this year, while its operating expenses could fall. So, higher oil prices and improvement in operating metrics could drive the company’s earnings, boosting its stock price.

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 Rajiv Nanjapla has no position in any of the stocks mentioned.

More on Energy Stocks

Group of industrial workers in a refinery - oil processing equipment and machinery
Energy Stocks

This Canadian Energy King (and its Fast-Growing Dividend) Is Too Cheap to Ignore!

Canadian Natural Resources (TSX:CNQ)(NYSE:CNQ) stock has been rewarding shareholders with huge dividend hikes of late, and they may not slow…

Read more »

Safety helmets and gloves hang from a rack on a mining site.
Energy Stocks

Oil Stocks May Start a 2nd Rally in October

Oil stocks like Cenovus Energy (TSX:CVE)(NYSE:CVE) could rally in the second half of the year.

Read more »

consider the options
Energy Stocks

Where to Invest $1,000 for the Next 5 Years

NPI (TSX:NPI) and these other two strong TSX stocks are perfect for Canadian investors with just $1,000 to invest in…

Read more »

oil and gas pipeline
Energy Stocks

What’s Next for Canadian Natural (TSX:CNQ) Stock After Its Solid Q2 Earnings?

TSX energy stocks will likely keep rewarding shareholders big time,

Read more »

A worker overlooks an oil refinery plant.
Energy Stocks

2 Oil Stocks With Mind-Blowing Gains in 1 Year Could Still Rise

Two oil stocks with mind-blowing returns in one year could climb further if oil demand picks up in winter.

Read more »

oil tank at night
Energy Stocks

Why Cenovus Energy (TSX:CVE) Rose 12% Last Week

Cenovus Energy (TSX:CVE)(NYSE:CVE) gained 9.4% last week. Here's why.

Read more »

oil and natural gas
Energy Stocks

Better Buy: Suncor or Cenovus?

Suncor Energy Inc. (TSX:SU)(NYSE:SU) and Cenovus Energy Inc. (TSX:CVE)(NYSE:CVE) have soared in the year-over-year period.

Read more »

A stock price graph showing declines
Energy Stocks

2 Cheap Canadian Stocks That Likely Won’t Be on Sale For Much Longer

These two Canadian stocks are close to returning to all-time highs. Don’t miss your chance to take advantage of these…

Read more »