Canadian stocks marked a recovery in 2023, as the economy turned out better than feared. Meanwhile, the expected decline in interest rates, economic improvement, and investors’ growing appetite for risky investments suggest that equities could continue to appreciate in 2024.
Against this backdrop, let’s look at five incredible Canadian stocks with solid fundamentals and potential to deliver stellar returns.
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Shopify
Shopify (TSX:SHOP) stock bounced back sharply and more than doubled in 2023. Despite the notable growth in its value, this technology stock is a must-have in your portfolio for 2024. The e-commerce platform provider continues to deliver solid sales growth led by strength in its gross merchandise volume (GMV) and higher merchant solutions revenue.
Shopify is well positioned to capitalize on the structural shift in selling models towards omnichannel platforms and will likely deliver durable revenue growth. Further, Shopify’s transition toward an asset-light model, cost-cutting measures, and initiatives to ease margin pressure will enable the company to generate sustainable earnings, which will lift its share price.
Brookfield Renewable Partners
Brookfield Renewable Partners (TSX:BEP.UN) is a pure-play renewable energy company and a top stock to capitalize on the stellar demand for clean energy. It owns a highly diversified portfolio of renewable energy assets and has a robust development pipeline. Further, the company’s highly contracted business and long-term power-purchase agreements enable it to generate solid cash flows and drive its dividend payouts.
While a higher interest rate environment restricted the upside in Brookfield Renewable Partners stock in 2023, it remains well positioned to deliver solid financials and enhance shareholders’ return through higher dividend payouts in 2024. Besides long-term contracts, its focus on lowering costs and strategic acquisitions will support its financials and share price.
Dollarama
Dollarama (TSX:DOL) is a must-have stock to add stability to your portfolio. Moreover, it offers high growth and regular income. The company sells items at low, fixed price points, which drives its financials in all market conditions. Thanks to its stellar growth and resilient business, this low-volatility stock has consistently outperformed the TSX and has rewarded its shareholders with higher dividend payments.
This Canadian value retailer will likely benefit from its extensive store base and value pricing strategy. Further, leverage from higher sales, direct sourcing, and a focus on improving efficiency will fuel its earnings and support higher dividend payouts in the long term.
goeasy
goeasy (TSX:GSY) is a top growth stock that has consistently outperformed the TSX and has made its investors rich. Its revenue and adjusted earnings per share sport a five-year CAGR of 19.6% and 31.9%, respectively, implying that the company has been growing its financials rapidly. Also, this subprime lender is a Dividend Aristocrat and has raised its dividend for nine consecutive years.
goeasy’s diversified revenue base, large addressable market, omnichannel offerings, and higher loan originations will support its top line. Meanwhile, its solid underwriting capabilities, steady credit and repayment volumes, and operating efficiency will cushion its bottom line. goeasy stock has a forward price-to-earnings multiple of 10, which appears attractive considering its double-digit earnings growth.
WELL Health
WELL Health Technologies (TSX:WELL) should be on your radar. This digital healthcare company has consistently delivered solid growth thanks to its growing omnichannel patient visits. Moreover, the company is profitable and is registering solid organic sales growth.
WELL Health’s focus on profitable growth strategies, investments in artificial intelligence, new product launches, and accretive acquisitions will continue to drive its financials and share price. Moreover, WELL Health stock is trading cheap, which makes it a compelling investment.
