Here are some of the best TSX stocks to consider if you are beginning to invest in stocks.
Dollarama TSX stock
A long-running bull rise ended in 2022 with the arrival of bear markets. Canadian value retailer Dollarama (TSX:DOL) has increased 35% this year, while overall equities are down 6%. Notably, DOL stock has done better during previous bull markets. In light of this, it is one of the few stocks suitable for an all-weather portfolio.
Despite this year’s record-breaking inflation and rate increases, Dollarama has demonstrated excellent profit growth and margin stability. This demonstrates its commercial power and explains its superior performance.
Future expansion may be fueled by the company’s effective supply chain operations, distinctive value offers, and extensive geographic reach. Therefore, even though DOL stock is currently trading at all-time highs, it may still increase during the following year.
Cenovus Energy TSX stock
For the third year in 2022, the energy industry has had the best performance. Cenovus Energy (TSX:CVE), one of many TSX energy stocks, appears well-positioned into 2023. This year, it outperformed its counterparts with a return of 55%.
Cenovus Energy has paid off billions of dollars worth of debt this year because of its high free cash flows. This has significantly strengthened its balance sheet. Furthermore, Cenovus intends to devote more cash flow to share repurchases the next year. So far this year, CVE has repurchased shares for $2.3 billion.
Despite the recent extreme volatility in oil and gas prices, these costs are projected to rise due to supply issues. Cenovus’s strong balance sheet and improved earnings-growth potential will probably increase shareholder value.
Bank of Montreal TSX stock
Compared to competitors, Bank of Montreal (TSX:BMO) excels on numerous fronts. Its current yield is slightly higher than TSX bank stocks, which is 4.5 percent. It’s interesting to note that over the past 194 years straight, shareholder dividends have been made.
The varied revenue base of BMO has demonstrated respectable earnings stability over the past few years. With the highest common equity tier-one ratio in the sector of 16.7%, it has a comparatively outstanding credit quality.
The stock has decreased 17% since its 52-week high in March this year amid fears of a recession. From a valuation standpoint, it is intriguing and has the potential for consistent development.
As rate hikes and inflation are expected to continue to dominate, it’s possible that TSX bank stocks won’t trade higher right away. However, BMO is a compelling investment due to its recent drop, consistency in earnings, and strong dividends.
Emera TSX stock
In these uncertain times, one of the traditional defensives to keep in mind is the Canadian utility Emera (TSX:EMA). It is a less volatile, more reliable investment that performs better in down markets. But remember that, like many utilities, it might not perform as expected during bull markets.
More than 2.5 million people in Canada, the United States, and the Caribbean receive services from Emera. Businesses like Emera continue to expand slowly across practically all economic cycles. It can therefore pay steadily increasing dividends. EMA stock’s current yield of 5.2% is higher than that of its competitors. It has returned 9.4% compounded yearly in the past ten years and a negative 5% for this year.
It appears to be undervalued, trading 20% below its 52-week highs. Utility companies like EMA may do better if the rate-hike pace slows or stops, likely next year.