The Bank of Canada will meet this week for the eighth and last time in 2023. Economists believe there won’t be a year-end rate hike, given the signs of a slowing economy. Also, according to some analysts, the markets should pull forward further when rate cuts begin by the second half of 2024.
From an investment perspective, people can make money from Athabasca Oil (TSX: ATH), Propel Holdings (TSX: PRL), and Blackline Safety Corp. (TSX: BLN) in 2024. These stocks have outperformed despite massive headwinds. A $1,000 investment can turn into $5,000 if they can sustain the upward momentum.
Clear winner
Athabasca Oil is a clear winner, evidenced by its 2,371% return in three years. Had you invested $1,000 on December 3, 2020 ($0.15 per share), your money would be $25,533.33 today. As of this writing, the share price of this mid-cap stock is $3.83 (+58.92% year to date).
The $2.2 billion energy company has a significant land base in the Western Canadian Sedimentary Basin where it develops thermal and light oil assets. Athabasca’s Thermal Oil Division boasts a low-decline production base that generates significant free cash flow (FCF).
The light oil and liquids-rich natural gas produced by the Light Oil Division from unconventional reservoirs have high-margin liquids-rich returns. In Q3 2023, Athabasca incurred a net loss of $79.2 million. However, it reported record cash flow and FCF of $168 million and $108 million, respectively, during the quarter.
Management maintains a positive outlook in 2024 due to years of industry under-investment, demand trends, and the latest production cuts by OPEC+ members.
AI-powered underwriting technology
Propel Holdings is a fast-rising financial technology company. At $11.32 per share, current investors are up 59.4% year to date and partake in the 3.71% dividend. The fintech platform of this $388.5 million financial services firm provides credit solutions to its customers. It takes pride in building a new world of financial opportunity through its industry-leading loan management system.
In the first three quarters of 2023, revenue and net income rose 34.2% and 91.3% year over year to US$220.5 million and US$19.3 million, respectively. Management said the fintech’s solid financial position supports the continued expansion of existing programs, growth initiatives, and increased dividends.
Propel’s AI-powered underwriting technology is a competitive advantage. It can evaluate thousands of applications and provide a more comprehensive and current picture of an applicant’s financial health.
Free cash flow generating business
Blackline Safety continues to rise from obscurity. At only $3.88 per share, the year-to-date gain and trailing one-year price return are 114.4% and 141%. This $281.2 million company specializes in connected safety technology. It develops, manufactures, and markets worker safety monitoring products and services.
In Q3 2023, Blackline recorded 26 consecutive years of year-over-year revenue growth. During the quarter, total revenue (product and service) rose 24% to $24.8 million versus Q3 2022. The net loss thinned to $6.8 million or 58% year over year. Its chairman and CEO, Cody Slater, said Blackline would soon be a sustainable FCF-generating business.
Multi-baggers
Athabasca Oil, Propel Holdings, and Blackline Safety are potential multi-baggers in 2024. Their business performance and growth trajectories should give investors the confidence to invest this December.
