TSX Industrials in April 2024: The Best Stocks to Buy Right Now

Industrials is one the most diverse sectors on the TSX, covering a wide range of businesses from transportation to manufacturing.

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The TSX Capped Industrials Index has increased 24% in less than six months — a bull market comparable to more volatile sectors like tech. The growth phase is also impressive considering the diversity within the industrial sector, covering a wide range of industries from railway to manufacturing. If you want to leverage the current bullish momentum of this sector, three stocks should be on your radar.

A transportation stock

After several years of quiet growth and the last few years of explosive growth, TFI International (TSX:TFII) has emerged as one of the most formidable names in the Canadian and even North American transportation and supply chain industry.

It has one of the largest trucking fleets in Canada and an impressive network of operating companies. Its footprint and fleet make it an ideal transportation/logistics partner for many businesses on the continent.

The TFII stock has been moving up for more than 15 years, but the most significant growth has happened in the last five years, when the stock rose by about 417%. Even more impressive than its growth pace and extent is that the stock is still fairly valued. It’s a healthy dividend stock as well, but thanks to its massive capital-appreciation potential, the yield is usually relatively modest (1% right now).

A waste management company

Texas-based Waste Connections (TSX:WCN) is among the world’s largest publicly traded waste management companies and has an impressive North American footprint — providing services to residential and commercial customers across 46 U.S. states and six Canadian provinces.

The company has over $17 billion in assets, including recycling facilities. It’s also expanding its battery waste management/recycling capabilities, which may emerge as one of the most significant growth dimensions with the advent of electric vehicles.

Waste Connections is one of the best industrial stocks to buy now because of its long-term growth potential and safe business model. The stock almost doubled the capital of its investors in the last five years (94% growth). It’s also a Dividend Aristocrat that offers financially healthy payouts, but the yield is usually too low (0.5% right now).

An agricultural equipment company

Food is one of the most ever-green businesses in the world, and if you invest in companies like AGI (TSX:AFN) that are at the core of the food supply chain, you can leverage this evergreen strength of the sector to its full extent.

AGI offers a wide range of agricultural solutions to farmers around the globe and customized solutions, which may become a massive growth avenue for the company as climate change forces farmers to adapt.

From a long-term growth perspective, AGI is the most humble industrial stock of the three, but it’s also the most attractively valued right now, with a price-to-earnings ratio of 17.7. However, if we focus on the last couple of years, AGI’s growth has been impressive. The stock has risen by about 120% since Nov. 2021. It also pays dividends, but the yield is under 1%.

  • We just revealed five stocks as “best buys” this month … join Stock Advisor Canada to find out if Waste Connections made the list!

Foolish takeaway

The three industrial stocks are among the best the sector offers, and all three can be held in your portfolio for the long term. Despite being from the same sector, they are different enough for adequate diversity.

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.

Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool recommends Ag Growth International. The Motley Fool has a disclosure policy.

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