June is going to be a great month for investors. I mean, investors are inherently optimistic, right?
However, even for the most bullish bulls out there, traps always exist in every market. Accordingly, picking the momentum stocks with the best chances of longer-term success is what we’re after.
These three companies all have significant medium-term momentum. Additionally, these companies have catalysts I think can take them higher over the medium to long term as well. Let’s dive in.
Air Canada
The pre-eminent pandemic reopening play Air Canada (TSX: AC) is a stock that has seen impressive momentum of late. While Air Canada appears to have stalled somewhat in recent months, near-term momentum is picking up once again. And for good reason.
Vaccine drives are proving successful, and we’re seeing more of the economy reopen. Travel restrictions recently were loosened on travelers coming into Canada. With global vaccine passports being discussed, the hope is that international air travel could resume sooner than later. For investors in Air Canada, this is a very good thing.
Indeed, the amount of pent-up demand for travel is insane. Couple this demand with a healthier balance sheet thanks to a government bailout, and investors are picking up shares in a company with some potential to provide rather impressive returns over the near to medium term.
Cineplex
Another company hit hard by the pandemic has been Cineplex (TSX:GGX). However, like its pandemic reopening peers, Cineplex has seen its share price recover substantially of late.
Additionally, the cinema space is one that’s getting hit hard by the meme trade of late. Thus, near-term momentum for this stock could potentially really heat up. While we haven’t seen as much enthusiasm for Cineplex stock as we have with a certain cinema purveyor south of the border, investors may be enticed by this momentum play today.
Indeed, the near- to medium-term outlook for Cineplex may be better than expected. If a rush to theatres does materialize in the coming quarters, it’s possible Cineplex could rebound significantly. For now, this remains a high-risk, high-reward, speculative pick for aggressive investors.
Western Forest Products
Those who haven’t seen where lumber prices are right now need to check out the chart of this commodity. While lumber prices have cooled off a bit, they’re still trading well above their historical range.
For producers such as Western Forest Products (TSX: WFG), this is an extremely good thing. The company’s cash flow growth profile and medium- to long-term outlook are much improved. Certainly, when one considers where this stock was trading in recent years, Western Forest Products’s current stock price is a godsend to long-term investors.
How long this momentum can continue is the real question for investors. However, for those bullish on a continued rally in commodities, WFG stock is one that could continue to rally for another year or two.
