Market corrections can be unsettling for investors. However, it also presents opportunities to acquire quality stocks at attractive prices. Three Canadian companies might just stand out as potential buys before prices rebound. Today, let’s look at Agnico Eagle Mines (TSX:AEM), Canadian Natural Resources (TSX:CNQ), and Dollarama (TSX:DOL).
Agnico Eagle Mines
Agnico Eagle Mines is a leading Canadian gold producer with operations in Canada, Finland, and Mexico. Gold often serves as a safe-haven asset during economic uncertainties, making gold mining companies like Agnico appealing during market corrections.
In its latest earnings report, Agnico Eagle reported record financial results for 2024, including record revenue of $2.2 billion, record adjusted earnings of $632 million, and record operating cash flow of over $1.1 billion. The Canadian stock achieved record annual gold production, with 3.49 million ounces produced in 2024, surpassing the midpoint of their guidance. Agnico also maintained strong cost control, with total cash costs of $903 per ounce and all-in-sustaining costs of $1,239 per ounce, both within their guided range. Additionally, the Canadian stock reduced net debt significantly from $1.5 billion at the start of 2024 to $217 million by year-end, strengthening the balance sheet.
Agnico’s stock performance has been strong, with shares reaching new highs. The company’s robust financial performance and strategic positioning make it a compelling option for investors seeking stability and growth in the materials sector.
Canadian Natural Resources
CNQ is one of Canada’s largest oil and natural gas producers, with a diversified portfolio that includes oil sands, conventional crude oil, and natural gas operations. The Canadian stock’s substantial reserves and efficient operations position it well to benefit from any rebound in energy prices following a market correction.
In its fourth-quarter and full-year 2024 results, Canadian Natural reported strong financial performance. The company achieved a record annual production of 1,363,000 barrels of oil equivalent per day (BOE/d), with strong liquids production over one million barrels per day. Financial highlights include adjusted net earnings of $7.4 billion and adjusted funds flow of $14.9 billion for 2024. The Canadian stock returned approximately $7.1 billion to shareholders through dividends and share repurchases. Following recent acquisitions, Canadian Natural maintains a strong balance sheet with a debt-to-book capitalization of 32%. Plus, it has debt-to-adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) at times 1.1.
Furthermore, Canadian Natural has a history of maintaining a strong balance sheet and delivering consistent dividends, making it an attractive option for income-focused investors.
Dollarama
Dollarama is Canada’s leading dollar store operator, offering a wide range of affordable products. During economic downturns, consumers often turn to discount retailers to stretch their budgets, potentially boosting Dollarama’s sales.
In its most recent earnings report, Dollarama reported an increase in third-quarter sales and profit. Driven by a rise in demand from price-sensitive consumers seeking discounted household supplies, groceries, and non-essentials amid high rents and food prices. The company’s net sales grew by 5.7% to $1.56 billion, while net earnings per share increased by 6.5% to $0.98, aligning with analysts’ expectations. The gross margin for the quarter was 44.7% of sales, slightly down from the previous year’s 45.4% due to increased logistics and freight costs. Dollarama maintains its annual comparable store sales forecast.
The company’s extensive network of stores and focus on value pricing make it well-positioned to perform resiliently during market corrections. All together, investing during a market correction requires careful consideration of each company’s fundamentals and the broader economic context. While these Canadian stocks have strong market capitalizations and operate in sectors that can offer resilience during downturns, it’s essential to align any investment decisions with your individual financial goals and risk tolerance.
