As we turn the page on 2024 and explore what 2025 should bring to the stock market, investors have plenty to consider. Interest rates are still coming down, but how much more interest rates will decline from here is unknown. And with the global economy seemingly in decent shape (with plenty of potential headwinds ahead), we could be due for some volatility this year.
For those looking to rebalance their portfolio into Canadian market leaders that may outperform over the course of 2025 and beyond, here are three companies I’ve got on my radar right now.
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Suncor Energy
Suncor Energy (TSX: SU) is a leading integrated energy company focused on delivering crude oil and related products from the Canadian oil sands to refineries, mostly in the U.S. Indeed, the company’s impressive upturn over the past year, in the face of some rather negative rhetoric from President-elect Donald Trump, is notable.
Much of this move has to do with Suncor’s fundamentals, which have shown an incredible turnaround. The company has moved from prior difficulties to industry-leading performance. Suncor’s net earnings for the third quarter of 2024 came in at $2.020 billion ($1.59 per common share), which was an impressive increase from $1.544 billion ($1.19 per common share) in the same quarter the year prior.
These gains were broadly driven by increased productivity and improved operational efficiency. The company saw its production surge from 787,000 barrels per day (bbls/d) in the third quarter (Q3) of 2023 to 909,600 bbls/d in Q3 2024, and the company’s total oil sands bitumen output increased significantly. During this time, Suncor also set a new refinery utilization record of 105%. And at the same time, oil prices have remained robust (and somewhat less volatile).
Moreover, Suncor has concentrated on raising operating effectiveness and safety standards under the direction of Chief Executive Officer Rich Kruger, who was hired in April 2023. Production and profitability have grown as a consequence of these initiatives, and the corporation has already surpassed its net debt objective of $8 billion. SU has outperformed its counterparts in the energy industry, with its shares up almost 29% so far this year.
Newmont
Investors looking to gain exposure to the precious metals market may want to consider top gold miners such as Newmont (TSX: NGT) right now. I’ve long touted gold mining companies as a preferable way to play higher gold prices over the long term for a range of reasons. But Newmont is certainly among the highest-quality options to consider in this space, in my view.
Gold miners like Newmont produce outsized gains when the price of gold rises due to the fact that the company’s revenue is denominated in gold, while its costs and debt are denominated in dollars. This leads to significant operating leverage that investors can take advantage of.
Despite a recent dip from last year’s 52-week high, I think the future outlook for Newmont remains strong. The company also seems to think so, recently announcing a quarterly dividend of $0.25 per share and recording an adjusted net income of $0.25 per diluted share in Q3 2024.
During this past quarter, the business generated 256,000 attributable gold equivalent ounces from co-products and 1.29 million attributable gold ounces. Consistent dividend payments from Newmont demonstrate the company’s dedication to shareholder returns by giving investors a reliable source of income.
Furthermore, the firm is well-positioned to benefit from the continuous demand for gold due to its varied asset portfolio and smart investments in environmentally friendly mining methods. Gold continues to be a beneficial hedge in the face of ongoing global economic uncertainty, and investors looking to get exposure to this industry should trust Newmont because of its steady production levels and sound financial standing.
Manulife Financial
One of the top global providers of financial services, Manulife Financial (TSX: MFC), has performed well, especially in its Asian regions. The corporation exceeded estimates of analysts in Q2 2024 by reporting core earnings of $1.74 billion, or $0.91 per share. The region’s importance in Manulife’s overall strategy was highlighted by the 40% increase in profitability from its Asian businesses, which drove this growth.
Manulife has set high goals for the future, hoping to reach a core return on equity of more than 18% by 2027. The company is well-positioned for long-term growth because of its emphasis on low-risk, high-growth ventures and its robust presence in Asia. Manulife’s dividend payments, which offer a consistent source of income, are another advantage for investors.
