Santa Claus Rally Incoming: 3 Top Canadian Stocks to Buy

You don’t need to believe in Santa Claus to buy into the Santa Claus Rally narrative with these three Canadian stocks.

| More on:

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

As the year draws to a close, investors awaiting a so-called Santa Claus Rally may be focused on which companies may benefit the most from an end-of-year surge in the stock market. Indeed, December happens to historically be one of the best months for investors, for a number of reasons. But aside from typical seasonal catalysts, this year has brought a number of other potential catalysts to the fore for investors.

Whether it’s the Trump win last month or an improving outlook for 2025, various stocks appear poised to ride a wave of enthusiasm higher into the New Year. Here are three top Canadian stocks I’ve got on my radar right now that may do just that.

Restaurant Brands

Restaurant Brands (TSX:QSR) is the parent company of Tim Horton’s, Burger King, and Popeyes. As such, the company has become a stalwart in the quick-service restaurant industry. With its global footprint and strong brand equity, the brand is poised to perform well during the holiday season and beyond.

Created with Highcharts 11.4.3Restaurant Brands International PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.ca

Despite economic uncertainties, the demand for quick-service dining remains robust, particularly during the holiday rush when families opt for fast and convenient meal options. Impressively, Restaurant Brands reported system-wide sales of $11.4 billion in its most recent quarter, driven by same-store sales growth and new restaurant openings.

The company is aggressively expanding into international markets, including Asia and the Middle East, diversifying its revenue base. In addition, Restaurant Brands offers a dividend yield of approximately 3.3%, making it appealing for income-seeking investors during the rally. With its strong financial performance and global growth strategies, the company is well-positioned to ride the holiday market wave.

Fortis

Fortis (TSX:FTS) is one of North America’s largest regulated utility companies. The stock is a safe bet for investors seeking stability during market volatility. The company operates in electric and gas utilities across Canada, the U.S., and the Caribbean.

Created with Highcharts 11.4.3Fortis PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.ca

Fortis, boasting an impressive 50-year track record of dividend increases, is currently yielding around 4%. It makes Fortis Inc. a favourite stock among risk-averse investors. Moreover, Fortis enjoys stable cash flows, even in uncertain economic climates, as a regulated utility in Canada. The company has committed to investing $22.3 billion in its five-year capital plan, focusing on renewable energy and infrastructure upgrades. 

With utility stocks often trading at discounts during the year-end, Fortis can see renewed interest during the Santa Claus Rally. Furthermore, Fortis offers stability and long-term growth potential. This makes it an excellent choice for the rally and beyond.

Dream Industrial REIT

Dream Industrial REIT (TSX:DIR.UN) specializes in logistics and warehousing properties, an asset class experiencing a surge in demand due to e-commerce growth and supply chain realignment.

Created with Highcharts 11.4.3Dream Industrial Real Estate Investment Trust PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.ca

The REIT reported a 98.5% occupancy rate in its portfolio and continues to benefit from rental rate increases across its properties. It has been actively acquiring properties in high-demand regions, including urban hubs and logistics corridors, to capitalize on the boom in online shopping.

Offering a dividend yield of approximately 5.8%, Dream Industrial REIT helps you generate reliable income with the potential for capital appreciation. In addition, with the continued rise of e-commerce and onshoring of supply chains, demand for industrial spaces is unlikely to wane, making Dream Industrial a long-term winner. Dream Industrial is set to deliver solid returns during the rally as a well-managed REIT with exposure to one of the hottest real estate segments.

Should you invest $1,000 in Nvidia right now?

Before you buy stock in Nvidia, consider this:

The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Nvidia wasn’t one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $20,697.16!*

Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 29 percentage points since 2013*.

See the Top Stocks * Returns as of 3/20/25

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 Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool recommends Dream Industrial Real Estate Investment Trust, Fortis, and Restaurant Brands International. The Motley Fool has a disclosure policy.

Confidently Navigate Market Volatility: Claim Your Free Report!

Feeling uneasy about the ups and downs of the stock market lately? You’re not alone. At The Motley Fool Canada, we get it — and we’re here to help. We’ve crafted an essential guide designed to help you through these uncertain times: "5-Step Checklist: How to Prepare Your Portfolio for Volatility."

Don't miss out on this opportunity for peace of mind. Just click below to learn how to receive your complimentary report today!

Get Our Free Report Today

More on Investing

Canada day banner background design of flag
Tech Stocks

The Top Canadian Stock to Buy With $5,000 in 2025

There are few Canadian stocks out there that offer the outlook of this tech stock, bound for more growth.

Read more »

A close up color image of a small green plant sprouting out of a pile of Canadian dollar coins "loonies."
Dividend Stocks

I’d Put $15,000 in These 3 Dividend-Growth Champions for Increasing Income Potential

Want to offset some volatility? Here are three defensive dividend-growth champions that can generate a juicy yield right now.

Read more »

Cannabis business and marijuana industry concept as the shadow of a dollar sign on a group of leaves
Stocks for Beginners

Buy the Dip Before It’s Too Late: This Canadian Stock Won’t Stay Cheap Forever

Investors might think that cannabis stocks are out, but this one could be the top Canadian stock to consider.

Read more »

Blocks conceptualizing Canada's Tax Free Savings Account
Dividend Stocks

Transform Your TFSA Into a Cash-Creating Machine With $7,000

Discover how the Tax-Free Savings Account can be your golden goose for generating cash without losing your investment.

Read more »

monthly desk calendar
Dividend Stocks

How I’d Invest $10,000 in Canadian Value Stocks for Monthly Dividend Income

A $10,000-diversified portfolio of value stocks focusing on dividend safety, yield, growth, and payment schedules can provide a reliable source…

Read more »

Canadian dollars are printed
Investing

How I’d Invest $1,000 Right Now for Long-Term Growth

These three Canadian stocks could deliver superior returns in the long run.

Read more »

a person watches a downward arrow crash through the floor
Dividend Stocks

Is This Correction Your Chance? Top 4 Canadian Dividend Stocks on Sale

Stocks may be down, but now is your chance to get some of these top dividend stocks on sale.

Read more »

open vault at bank
Bank Stocks

3 Canadian Bank Stocks to Shield Against Market Downturns

Canadian bank stocks are some of the best options on the market, and these three are probably the top ones.

Read more »