While major equity indices are trading near all-time highs, the rally has been primarily driven by tech stocks. This means Canadian investors can still identify several quality stocks that will trade at a reasonable multiple in November 2024.
Jamieson Wellness (TSX:JWEL) and Lassonde Industries (TSX:LAS.A) are two top Canadian stocks you can consider buying, with just $1,000 right now. Let’s see why.
The bull case for the Canadian stock
Valued at $1.47 billion by market cap, Jamieson Wellness has more than doubled shareholder returns since its IPO (initial public offer) in July 2017. However, it trades 18% below all-time highs and has trailed the broader market in the last three years.
Jamieson Wellness develops, manufactures, distributes, markets, and sells natural health products in Canada and other international markets. Its Jamieson Brands segment offers health products such as vitamins, herbals, and nutritional supplements. Jamieson also has a strategic partners business that provides manufacturing and product development services on a contract manufacturing basis to other consumer health companies and retailers.
In the last 12 months, Jamieson Wellness has reported revenue of $709.4 million, an increase of 9.4% year over year. Notably, its top-line growth accelerated by 16% year over year to $176 million in the third quarter (Q3) of 2024.
While sales in Canada were up 15%, revenue earned from China grew by 82% in the September quarter. Jamieson emphasized it outpaced category growth in terms of units and dollars in China, which is the second-largest economy in the world.
Jamieson Wellness is positioned to benefit from steady growth in the upcoming decade as consumers continue to focus on prioritizing their health and wellness.
Jamieson is forecast to end 2025 with adjusted earnings per share of $2 and a free cash flow of $75 million, according to consensus estimates. So, priced at 18 times forward earnings and 19 times free cash flow, JWEL stock is quite cheap and is expected to gain 10% in the next 12 months.
Moreover, Jamieson offers shareholders a forward yield of 2.4%, given it pays an annual dividend of $0.84 per share, up from $0.32 per share in January 2018. Investors can expect consistent dividend hikes to continue as Jamieson is projected to expand its earnings and cash flow over time.
What is the target price of Lassonde stock?
Valued at $1.2 billion by market cap, Lassonde Industries (TSX:LAS.A) develops, produces, and markets a wide range of ready-to-drink fruit juices and frozen juice concentrates in North America and internationally.
Down almost 40% from all-time highs, Lassonde has trailed the broader markets since June 2018. However, this underperformance has meant that the TSX stock currently trades at a forward price-to-earnings multiple of 10 times. Moreover, its adjusted earnings are forecast to expand by 17.8% annually between 2023 and 2025.
In the last 12 months, Lassonde has reported a free cash flow of $119 million and is forecast to end 2024 with a free cash flow of $129 million. Given its annual dividend of $4 per share, Lassonde’s annual dividend expense is around $27 million, indicating a payout ratio of just 22%.
Analysts remain bullish and expect the TSX dividend stock to gain over 20% in the next 12 months, given an average target price of $213.50.
