Here Are My Top 5 TSX Stocks to Buy Right Now

With interest rates set to decline and many stocks due for a recovery, here are five of my top TSX stocks to buy right now.

Group of people network together with connected devices

Source: Getty Images

After several years of significant macroeconomic headwinds impacting stocks and now with interest rates starting to decline, there are plenty of top TSX stocks for investors to buy right now.

Higher interest rates not only make dividend stocks worth less as yields rise, but they also make it more expensive to service debt, impacting the margins of stocks across many different industries.

So now, as central banks start to look forward to declining interest rates, there are plenty of cheap TSX stocks to buy before they start to rally and recover, ultimately becoming more expensive.

So, with that in mind, if you’re looking for top TSX stocks to buy now, here are my top five to consider today.

Two recovery stocks to buy now

Since the pandemic, a handful of high-quality stocks have never fully recovered, such as Cineplex (TSX:CGX), the massive Canadian entertainment company.

Cineplex initially lost a tonne of its value due to the lockdowns that came with the pandemic and the fact that it couldn’t host customers in its theatres during these capacity restrictions.

In addition, though, one of the biggest factors impacting Cineplex, especially since restrictions were dropped, was a lack of high-quality content coming from Hollywood.

However, with many blockbuster films set to be released in the second half of 2024 and throughout 2025, Cineplex could start to see a significant uptick in its revenue over the coming quarters, making it one of the top TSX stocks to buy now.

Meanwhile, Air Canada (TSX:AC) is another high-potential stock that never fully recovered.

Like Cineplex, most of its revenue was impacted through the pandemic, and once travel and capacity restrictions were dropped, other macroeconomic factors such as interest rates and surging costs impacted Air Canada.

However, with those headwinds easing and Air Canada continuing to see record revenue, the stock could begin to rally soon, making it one of the top TSX stocks to buy right now or, at the very least, add to your watchlist.

Three top TSX stocks to buy now as interest rates start to decline

In addition to those two recovery stocks, though, there is also significant potential to buy top TSX stocks today that have been trading cheaply as a result of higher interest rates and the uncertain economic environment. These are stocks like B2Gold (TSX:BTO), Brookfield Infrastructure Partners (TSX:BIP.UN), and Canadian Apartment Properties REIT (TSX:CAR.UN).

Low-cost producer

Gold stocks like B2Gold typically sell off as interest rates rise. This is due to the fact that as yields increase, the demand for income-generating assets increases, while the demand for gold, a safe haven asset that provides no yield, typically falls.

As we’ve seen throughout 2024, though, with interest rates peaking and now looking like they are set to decline over the coming quarters, the price of gold has been rallying. In fact, over the last six months, the price of gold is up 15%, yet B2Gold shares are down over 10%. So not only is the price of gold increasing for B2Gold, but it’s also one of the lowest-cost producers in Canada.

Therefore, as the price of gold rises, B2Gold’s profit margins will expand considerably. So it’s only a matter of time before B2Gold eventually recovers, making it one of the top TSX stocks to buy right now.

Long-term growers

Brookfield and Canadian Apartment Properties (CAPREIT) could also see a rally from the lowering of interest rates. Both of these companies use significant debt to leverage their operations, meaning that as the cost of servicing debt declines, they could see an improvement in margins and, ultimately, more income for investors.

Plus, both Brookfield and CAPREIT are two of the top long-term growth stocks on the TSX. Therefore, not only do they have the potential to see a significant rally in the coming months, but this also might be the last time investors can buy these stocks while they are this cheap for a while.

So, if you’ve got cash on the sidelines that you’re looking to put to work, now is an excellent time to do so, and these five stocks are my top five TSX stocks to buy right now.

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 Daniel Da Costa has positions in B2Gold and Brookfield Infrastructure Partners. The Motley Fool recommends B2Gold, Brookfield Infrastructure Partners, and Cineplex. The Motley Fool has a disclosure policy.

More on Investing

A worker drinks out of a mug in an office.
Dividend Stocks

1 Dividend Stock to Buy if the Bank of Canada Keeps Cutting Rates 

This dividend stock is sure to benefit from ongoing cuts in the key interest rate and is already seeing some…

Read more »

ETF chart stocks
Investing

2 Canadian ETFs to Buy and Hold Forever in Your TFSA

I personally own both of these S&P 500 Index ETFs. Here's why.

Read more »

A close up image of Canadian $20 Dollar bills
Dividend Stocks

How Much Cash Do You Need to Quit Work and Live Off Dividend Income

Toronto-Dominion Bank (TSX:TD) pays a lot of dividend income. Can you live off of it in retirement?

Read more »

Retirees sip their morning coffee outside.
Retirement

Retirees: 2 TSX Dividend Stocks That Have Raised Payouts for Decades

These top TSX dividend stocks now have 7% yields.

Read more »

tsx today
Stock Market

TSX Today: What to Watch for in Stocks on Tuesday, June 25

Besides Canada’s consumer inflation report, the latest U.S. consumer confidence data will remain on TSX investors’ radar today.

Read more »

An analyst uses a computer and dashboard for data business analysis and Data Management System with KPI and metrics connected to the database for technology finance, operations, sales, marketing, and artificial intelligence.
Dividend Stocks

Invest $10,000 in This Dividend Stock for $1,398.40 in Passive Income 

This dividend stock offers a whopping 11.9% dividend yield right now, with returns that should fly high for this cyclical…

Read more »

top TSX stocks to buy
Top TSX Stocks

Could This Undervalued Stock Make You a Millionaire One Day?

Looking for an undervalued stock you can buy today and hold for decades? Here's a great pick with a generous…

Read more »

An airplace on a runway
Stock Market

With Revenue Rising, Is Air Canada’s Sputtering Stock Finally Cleared for Takeoff?

Down 58% from all-time highs, Air Canada stock trades at a discount to consensus price target estimates in June 2024.

Read more »