Canadian markets are up almost 17% so far this year, outperforming the S&P 500. Experts anticipated a market crash amid the thorny path of the pandemic. However, whether inflation fears or fresh variants of coronavirus, markets defied all challenges and kept climbing higher. Here are some of the top-gainer TSX stocks so far this year.
The energy sector substantially overshadowed broader markets since last year. Enerplus (TSX:ERF) is a Canadian oil and gas production company that gained 120% this year. Notably, small- and mid-sized energy companies beat their larger counterparts this year.
Along with decent financial growth, Enerplus’s accretive acquisitions fueled its rally this year. Its recently completed acquisition of Williston Basin assets is expected to increase operational efficiency. In addition, higher production and higher energy commodity prices notably boosted energy companies’ margins in the last few quarters.
Higher crude oil prices could continue to drive earnings recovery for energy producers. Despite the rally, Enerplus stock is trading at a discounted valuation. Interestingly, undervalued stocks like Enerplus will likely keep on soaring higher if energy markets continue to improve.
Canada’s top copper miner Capstone Mining (TSX:CS) stands second on this list with its 115% gain so far this year. The stock soared from close to $0.40 levels last March to $6.6 levels, representing a 1,600% gain in 12 months. However, it has corrected more than 20% since May and is currently trading at $5.15.
The copper price rally acts as a harbinger of global economic expansion. The base metal surge uplifted copper miners in tandem. It’s pleasing for copper investors to see such high growth in a little time span after years of underperformance. Interestingly, the outlook for metals remains rosy, which will likely drive copper stocks higher.
Capstone Mining’s revenues in Q1 2021 jumped by almost 200% year over year. It reported a net profit of $101 million for the quarter against a loss in the year-ago quarter.
Despite the bullish outlook, copper stocks remain an aggressive bet for investors. The volatility and uneven global recovery from the pandemic could dent conservative investors.
The third one on the list is BlackBerry (TSX:BB)(NYSE:BB). The stock rose 80% in the first half of 2021 and stands among the top gainers. The cybersecurity stock BlackBerry has been one of the target stocks of Reddit investors. It zoomed to $36 levels amid the meme stock frenzy in February, only to fall close to $10 in the subsequent weeks.
BlackBerry offers strong growth prospects with its significant presence in internet-connected devices and data security solutions. However, its financial growth still discourages discerned investors. Its revenue growth has been on a constant decline for the last five years. It was able to report profits only for three of the last 12 quarters.
BlackBerry’s QNX technology and the advent of smart mobility could be a game changer in the long term. Once it starts converting operational feat into financial growth, BlackBerry could again top the charts. But when is anybody’s guess.
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.
The Motley Fool recommends BlackBerry. Fool contributor Vineet Kulkarni has no position in any of the stocks mentioned.