Canada’s primary stock exchange blew hot on November 4 and 5, 2021. The TSX had a winning streak of 14 days last month and registered two new highs. At 22,455.80 points, the index is up 23.07% year to date (YTD). Also, November could turn out to be the breakout month this year.
Investors have three highly profitable choices that have delivered between 119% and 307% in 12 months. Cenovus Energy (TSX: CVE)(NYSE: CVE), Nexus (TSX: NXR.UN), and Converge Technology Solutions (TSX: CTS) should be on your watchlist, if not on your buy list. If the upward momentum continues, the potential returns could be significantly higher than what they are now.
Growth in shareholder returns
The energy sector outperforms the ten other primary sectors by a mile, with its nearly 84% YTD gain. Cenovus Energy is one of its constituents with an incredible run thus far in 2021. This $31.46 billion crude oil, natural gas liquids, and natural gas producer stands out if you’re looking for oversized returns.
Cenovus’s YTD gain is 102%, while the current share price is 229% higher than a year ago. Also, at $15.59 per share, this energy stock pays a modest 0.92% dividend. The company continues to deliver excellent operational and financial performance, especially in Q3 2021.
Management reported $2.13 billion cash from operating activities — a 192% year-over-year growth. Net income was $551 million compared to the $194 million net loss in Q3 2020. Alex Pourbaix, president and CEO of Cenovus, said, “Our free funds flow capacity will support swiftly advancing toward our longer-term net debt target of less than $8 billion, while balancing growth in shareholder returns.”
Income and capital gains
Nexus is the high flyer in the real estate sector. Thus far, in 2021, investors in this real estate investment trust (REIT) can’t be any happier. They’re up 82.61% YTD and have gained 119.23% in the last 12 months. The stock trades at $13.36 per share and pays a 4.79% dividend.
The $581.96 million REIT is growth oriented and among the hot picks this month. Nexus’s strategy focuses on growing its industrial properties, which are in high demand due to the e-commerce boom.
Besides long-term leases with embedded rent escalations, the industrial assets account for 68% of the net operating income (NOI) and provide stable cash flows. The 16% increase in net rental income in Q2 2021 versus Q2 2020 is solid proof of Nexus’s thriving leasing business.
Exciting times ahead
Converge Technology isn’t a dividend payer like Freehold and Nexus, but it has gained the most in one year (+307%). Had you invested $15,000 on November 5, 2020, your money would be worth $61,007.07 today. Moreover, at $11.51 per share, current investors enjoy a 132% YTD gain.
Market analysts’ rating for this tech stock is a strong buy. The $2.45 billion company from Toronto provides software-enabled IT & cloud solutions. It’s relatively young (five years) but slowly growing the customer base in North America. Converge’s expansion in Europe is likewise ongoing. Management says exciting times are ahead for this growth stock.
Far superior returns
Stock investing is not a popularity contest. Cenovus Energy, Nexus, and Converge Technology could deliver far better returns than the top names in their respective sectors.
