The TSX Bull Run might be running out of momentum. The 3% drop in the S&P/TSX Composite Index is the most significant since the 3.8% drop in January 2021. What’s even more troubling is the curve of the drop. It’s not a sharp dip, but a slow downward slide, which might indicate shifting momentum. But it’s pure speculation at this point, and the market is just as poised to resume its Bull Run as it is to continue on the downward path.
If you are looking for stocks poised for a Bull Run in a market that can go either way, here are three companies that should be on your radar.
A restaurant company
Restaurant businesses, especially those that couldn’t adapt to or weren’t suited for deliveries (mostly fine-dining ones), suffered a lot during the pandemic. But for Recipe Unlimited (TSX:RECP) stock, the downfall started before the pandemic. The stock started dipping in the last quarter of 2020 and fell about 70% by April 2021.
Despite the fact that the restaurant business was still suffering, the stock made a wonderful recovery and has grown about 146% from its rock bottom valuation. The recovery momentum started to wane in May, but the stock might be ready for another Bull Run. The valuation is just right, and the company has already taken several harsh steps toward reducing operational costs. If the demand surges, the revenues and the stock could follow.
A lithium company
American Lithium (TSXV:LI) has already seen multiple Bull Runs in the past year. The stock has spiked three times since April 2021, and the latest brought the stock up about 80%. The company has an impressive presence in the Americas, and apart from lithium projects, the company also owns one of the largest undeveloped uranium projects in the world.
It might not have enough capital to pursue that arena now, but if more uranium powerplants start coming online around the globe, the increased demand might give the company leverage to raise funding for its uranium project development as well. Till then, it is poised for a Bull Run based on lithium demand for batteries, especially EV batteries.
A retail fuel and convenience store company
The gas prices in Canada are expected to reach new heights, and one of the energy businesses that might benefit from it is Parkland (TSX:PKI). As one of the largest independent fuel retailers in the country, Parkland owns, operates, or supplies one out of every six fuel stations in Canada. It also has a sizeable commercial operation as well as a convenience store chain.
The company also has an impressive international presence in 25 countries, but the bulk of it is in the U.S. Parkland stock was a decent grower before the pandemic, and it has had some trouble gaining traction since its sharp 50% fall during the pandemic. But if the demand for fuel rises and the prices soar to new heights, Parkland might get to ride the growth wave.
The three stocks are all poised for a Bull Run, and each of them has different catalysts, triggers, and timelines. And if you invest in all three, you might essentially diversify your potential Bull Run. The three stocks are also from completely different industries, so the market macro factors that might empower or hurdle the growth will also be different.