3 Top TSX Stocks That Could Beat These Uncertain Markets

These TSX stocks will likely outperform in the short as well in the long term.

| More on:
data analyze research

Image source: Getty Images

Canadian stocks have lost 14% this year, and the fall does not seem over just yet. Macro worries will continue to weigh on markets towards the end of the year, making stock picking all the more crucial. So, here are three TSX stocks that could outperform.


Very few TSX stocks have withstood the immense volatility this year. Dollarama (TSX:DOL) is one such name that has not only stayed resilient but managed to outperform markets this year. It has returned 26% this year, notably beating TSX stocks.

Note that as stocks trade more volatile, and, as inflationary pressures mount, Dollarama will likely continue to outperform. Its unique business model and stable earnings growth stand tall in inflationary environments.

Dollarama’s value proposition and long-standing relationships with global suppliers bode well for its business growth. Moreover, its larger store count in Canada offers it a big competitive edge over peers. By 2031, Dollarama plans to reach its store count from currently 1,430 to 2,000, which will likely accelerate its financial growth in the long term.

Notably, Dollarama stock has outperformed in the short as well as in the long term, making it an apt bet for an all-weather portfolio.   

Tourmaline Oil

Canada’s natural gas producers will likely be in focus for the next few years, as the world grapples with energy supply woes. Tourmaline Oil (TSX:TOU) is Canada’s biggest natural gas producer and aims to produce 505,000 barrels of oil equivalent in 2022.

Notably, higher production and sky-high gas prices have substantially boosted its earnings this year. The trend will likely continue amid the war in Europe, making Tourmaline one of the most attractive bets among TSX energy.

Tourmaline paid off massive dividends in the last few quarters, thanks to its stellar free cash flow growth. At the end of 2020, it had a total debt of $1.9 billion, which has now fallen to a mere $470 million in the recent quarter. That’s a noteworthy balance sheet improvement. Lower debt will lower its interest expense, enhancing profitability.

Tourmaline has announced special dividends on three occasions this year, indicating its massive financial strength and earnings visibility. The stock has returned 85% in the last 12 months, beating peers by a big margin.


After two growth picks, my third is a defensive bet: Fortis (TSX:FTS)(NYSE:FTS). Defensives will steal the limelight, as recession fears have risen in the last few quarters.

What differentiates Fortis in the current markets is its earnings and dividend stability. Even if the economy and markets take an ugly turn from here, Fortis will likely keep growing steadily, as it has in the past. That’s why market participants move to utility stocks like FTS as market uncertainties increase.

FTS stock currently yields 3.6%, marginally higher than broader markets. If you invest $1,000 in FTS stock, it will pay $35 in dividends in a year.

Note that Fortis has one of the longest dividend-growth streaks of 48 consecutive years. Its strong balance sheet and earnings visibility facilitate such a long payout streak, irrespective of the broader economy.

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 FORTIS INC. The Motley Fool has a disclosure policy. Fool contributor Vineet Kulkarni has no position in any of the stocks mentioned.

More on Investing


CNR Stock: Should You Buy Today?

Canadian National Railway has been hit in recent quarters, as economic growth has slowed, with CNR stock declining 10% in…

Read more »

Family relationship with bond and care
Dividend Stocks

TFSA Investors: 3 Cheap Canadian Stocks for Retirees

These three Canadian stocks are super cheap for retirees looking for a great buy that will last the test of…

Read more »

calculate and analyze stock
Dividend Stocks

CPP Disability Benefits: Here’s How Much You Could Get

Not everybody can get CPP disability benefits. If you want some passive income, consider investing in Royal Bank of Canada…

Read more »

growing plant shoots on stacked coins
Dividend Stocks

Boosting Your Monthly Income: TSX Stocks That Deliver

Dividend investing can boost regular or active incomes, especially select TSX stocks that pay monthly dividends.

Read more »

consider the options
Tech Stocks

Better Buy (2024 Edition): Shopify or Nvidia Stock?

Shopify (TSX:SHOP) isn't the only red-hot tech stock in town that could add to recent gains.

Read more »

Bad apple with good apples

5 Stocks You Can Confidently Invest $500 in Right Now

These stocks could significantly grow your investment over the next decade.

Read more »

Illustration of bull and bear
Tech Stocks

A Bull Market Is Coming: 3 Growth Stocks That Could Thrive

Given their high growth prospects and cheaper valuation, these three growth stocks would be an excellent buy as the market…

Read more »

Golden crown on a red velvet background
Energy Stocks

Enbridge Stock: This Dividend Aristocrat Could Gain in 2024

Enbridge (TSX:ENB) stock is looking like a great buy as management expects it to grow in 2024.

Read more »