3 High-Flying TSX Stocks That Show No Signs of Slowing Down

Three TSX stocks with market-beating gains could deliver far superior returns in 2024 as the rate-cutting cycle begins.

| More on:
hot air balloon in a blue sky

Source: Getty Images

The road has been bumpy this year for the Canadian stock market. As the first half ends, the TSX’s year-to-date gain is 4% or only 49% of last year’s 8.1% overall return. However, some growth stocks continue to beat the broader market and show no signs of slowing down.

AtkinsRéalis Group (TSX:ATRL), Hammond Power Solutions (TSX:HPS.A), and 5N Plus (TSX:VNP) are winning investments thus far in 2024. Despite the elevated market volatility, these high-flying stocks have delivered handsome returns the past year. All three are strong buys now that the interest rate-cutting cycle by the Bank of Canada has begun.

Powerful organic growth engine

AtkinsRéalis benefits from increased infrastructure spending and has been securing multiple contracts non-stop. The $10.3 billion integrated professional services and project management company focuses more on engineering and nuclear projects than legacy contracts. At $58.55 per share, the one-year price return is 80.8%.

Management said the rebranding of SNC-Lavalin to AtkinsRéalis in 2023 is a transformational change and marked the beginning of a new era. Also, the growth strategy is deliberate, disciplined, and focuses on clearly defined end markets. AtkinsRéalis has a strong presence in Canada, the US, the UK and Ireland and operates in Australia, the Middle East, and the Asia-Pacific region.

According to its President and CEO, Ian L. Edwards, AtkinsRéalis has constructed a powerful, organic growth engine, which should deliver significant positive net cash from operations and drive long-term shareholder value. In Q1 2024, total revenues increased 11.9% year-over-year to $2.3 billion, while net income jumped 60.2% to $45.5 million compared to Q1 2023.

Industry leader

At $108 per share, Hammond Power is up 32.7% year-to-date, while the trailing one-year price return is 122.1%. Current investors also partake in the modest 1.04% dividend. The $1.3 billion company manufactures and sells dry-type transformers for the utility needs of various sectors, including industrial, infrastructure, and renewable energy.

In Q1 2024, sales increased 11.4% year-over-year to a record $190.7 million. However, net earnings fell 49.4% to $8 million due to higher selling, distribution, and general and administrative expenses. Notably, cash generated by operations reached $6.3 million compared to -$10.5 million in Q1 2023.

Its CEO, Adrian Thomas, notes strong project demand, particularly from emerging market segments. He expects sales volumes to grow further in the ensuing quarters.

High-growth markets

5N Plus is an excellent option for price-conscious investors. At $6.17 per share (+62.2% year-to-date), the basic materials stock is up 102.3% from a year ago. This $547.8 million company produces specialty semiconductors and performance materials and is a leading supplier to critical industries.

The business thrives amid a challenging environment. In the three months ending March 31, 2024, revenue and net earnings climbed 17.6% and 72.4% to US$65 million and US$2.5 million, respectively, compared to Q1 2023. Besides the record US$135 million in multi-year contracts for AZUR SPACE Solar Power GmbH in a single quarter, 5N Plus expects to sign more contracts in the near term.

Potential multi-baggers

AtkinsRéalis, Hammond Power Solutions, and 5N Plus are potential multi-baggers in 2024. Depending on your investment budget, all three are buying opportunities.

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 Christopher Liew has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Hammond Power Solutions. The Motley Fool has a disclosure policy.

More on Dividend Stocks

Cogs turning against each other
Dividend Stocks

How Interest Rate Cuts Affect REITs

Now is a good time to investigate Canadian REITs and take a position in the form of stocks or exchange…

Read more »

Simple life style relaxation with Asian working business woman healthy lifestyle take it easy resting in comfort hotel or home living room having free time with peace of mind and self health balance
Dividend Stocks

3 Affordable Passive-Income Stocks That Pay Monthly

These three monthly-paying dividend stocks could boost your passive income.

Read more »

Dividend Stocks

Retirees: 2 High-Yield Dividend Stocks to Buy in July

Retirees can rely on these dividend stocks for steady passive income and high yields.

Read more »

A Canada Pension Plan Statement of Contributions with a 100 dollar banknote and dollar coins.
Dividend Stocks

CPP Benefits Not Enough? This Top Dividend Stock Can Help Fund Your Retirement

Dividend stocks like Fortis Inc (TSX:FTS) have funded many a retirement.

Read more »

A steel grain silo storage tank with solar panel in a yellow canola field in bloom in Alberta, Canada.
Dividend Stocks

The Ultimate TSX Stock to Buy With $1,000 Right Now

Once at triple-digit prices, Nutrien stock (TSX:NTR) now offers a steal of a deal for long-term growth as well as…

Read more »

Paper Canadian currency of various denominations
Dividend Stocks

Set and Forget: 1 Dividend Stock That Could Create $1,000 in Tax-Free Passive Income in 10 Years

Enbridge operates a low-risk business that has allowed the TSX dividend giant to raise its payout by 10% annually since…

Read more »

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

Passive Income: How to Make $106 Per Month Tax Free

Holding quality, high-yield dividend stocks such as Freehold Royalties in a TFSA can help you earn tax-free income for life.

Read more »

TFSA (Tax free savings account) acronym on wooden cubes on the background of stacks of coins
Dividend Stocks

How to Earn a TFSA Paycheque Every Month and Pay No Taxes on it

Stocks like First National Financial (TSX:FN) pay you monthly. You can also earn monthly dividends through portfolio diversification.

Read more »