Rate optimism domestically and globally is driving the TSX higher. Canada’s primary stock exchange hit a record high of 24,033.80 on September 26, 2024, and the fourth quarter looks promising. Many individual stocks have rallied to help the index achieve 26 record closes in 2024.
AtkinsRéalis (TSX: ATRL) and Savaria (TSX: SIS) should be on your buy list before they skyrocket. Both companies display solid growth and profitability.
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Exceptional opportunities
AtkinsRéalis, formerly SNC-Lavalin, continues to win business and ensures sustained profitable growth in the future. The $9.5 billion engineering services and nuclear company have captured numerous projects this year. Its president and chief executive officer (CEO), Ian L. Edwards, said the company is encouraged by the exceptional opportunities in the nuclear portfolio, a powerful organic growth engine.
In the first half of 2024, revenue and net income increased 11.4% and 38.5% year over year to $4.63 billion and $127.7 million. “We concluded the first half of the year with another strong quarter, delivering significant year-over-year revenue growth and margin expansion,” added Edwards.
Because of robust demand for engineering services, the backlog, as of June 30, 2024, reached a record $15.9 billion, a 24% jump from a year ago. Management’s “Delivering Excellence, Driving Growth” strategy hopes to optimize the business, accelerate value creation, and explore untapped potential.
Recent awards include two of eight possible contracts from Network Rail to upgrade and digitize the U.K.’s rail-signalling system over the next 10 years. Last month, Atkins secured a mandate from Jubilant HollisterStier to provide a detailed design for the sterile injectable facility’s expansion. The project should boost Canada’s vaccine manufacturing capacity.
The province of British Columbia also selected AtkinsRéalis to deliver the Systems and Trackwork for the Surrey-Langley SkyTrain project in Canada. The transit extension accommodates the rapid population growth and increased demand for transit services.
Furthermore, Atkins raised its 2024 nuclear organic revenue growth guidance to 30-35%. Other growth catalysts are an aging global infrastructure and growing demand for its services to address the energy transition.
At $54.06 per share, the industrial stock is up 26.86% year to date and pays a modest 0.15% dividend.
Captured, growing market
Savaria, a prominent player in the accessibility industry, is among the stellar performers on the TSX. At $21.70 per share, current investors enjoy a 46.19% year-to-date gain on top of the 2.49% dividend. Prospective investors can earn in two ways: price appreciation and monthly dividends.
The $1.54 billion company provides accessibility solutions and boasts a comprehensive product line for the physically challenged and elderly. In the first half of 2024, revenue and net earnings increased 5.1% and 48.4% year over year to $430.8 million and $22 million. In the second quarter of 2024, the overall gross margin rose to 37.5%, a new level.
Savaria benefits from a captured, growing market. “Now is the time to be the best we can be to serve the aging population, whether they need a stairlift, a medical bed or a home elevator,” said its executive chairman, Marcel Bourassa.
Long-term hold
Market analysts believe the current bull market has more room to run, as do AtkinsRéalis and Savaria. Both are solid investment prospects for a long-term hold.
