19 Top TSX Stock Picks for October 2021
We requested our Silly writers for his or her prime concepts for October. Listed here are their picks.
Chris MacDonald: Couche-Tard
My prime inventory for October is Alimentation Couche-Tard (TSX:ATD.B). This Canadian large-cap inventory has been a long-term progress champion within the international comfort retailer and gasoline station house.
The corporate’s progress prospects stay strong, with extra consolidation doubtless on this fragmented house. Nevertheless, a scarcity of deal circulate of late has some buyers apprehensive.
That stated, I believe the corporate’s present valuation of solely 15 instances earnings is just too low-cost to disregard, given the corporate’s money circulate and earnings-per-share progress price. Accordingly, this may very well be the perfect basically sound inventory in Canada and one of the vital undervalued TSX shares on the market at the moment.
Idiot contributor Chris MacDonald has no place in any of the shares talked about.
Andrew Walker: Suncor
Suncor’s (TSX:SU)(NYSE:SU) share worth has trailed its friends in 2021, however the inventory ought to catch up subsequent 12 months after some operational points are sorted out and the board begins to lift the dividend.
Administration determined to make use of extra money in 2021 to scale back debt and purchase again shares. If oil costs maintain their 2021 features, buyers ought to see a beneficiant dividend hike in early 2022 to make up for a part of the 2020 lower to the payout.
The inventory seems low-cost proper now in an in any other case costly market.
Idiot contributor Andrew Walker owns shares of Suncor.
Kay Ng: Canadian Pacific Railway
The bidding conflict between Canadian Pacific Railway (TSX:CP)(NYSE:CP) and Canadian Nationwide Railway for Kansas Metropolis Southern has CP popping out because the winner and anticipated to shut the transaction by Q1 2022 in a inventory and money deal value about US$31 billion.
Often, the acquirer in a deal will dip due to increased uncertainty from the merger. Certainly, CP inventory has corrected about 17% since its all-time excessive in Might.
At $83 and alter per share at writing, the stable railroad trades at a good ahead price-to-earnings ratio of about 20.5 for its estimated three- to five-year earnings-per-share progress price of about 11.5%. Subsequently, CP is my prime choose for this month, particularly if it dips additional.
Idiot contributor Kay Ng owns shares of Canadian Pacific Railway.
Vishesh Raisinghani: Tourmaline Oil
As we method winter, the world faces an power disaster. Europe, China, and India are all going through rolling blackouts resulting from an unprecedented surge in electrical energy demand and a provide scarcity created by the pandemic. Oil and pure gasoline are hovering close to historic highs, which is a worthwhile catalyst for power big Tourmaline Oil (TSX:TOU). Unsurprisingly, Tourmaline inventory is up 150% 12 months up to now and continues to be comparatively undervalued. The inventory trades at a price-to-earnings ratio of 9.7 and presents a 1.55% dividend yield. Administration lately introduced a particular dividend of $0.75 per share to be paid subsequent month. The outlook for power producers has by no means been brighter. That’s why Tourmaline deserves a spot in your watch record for October.
Idiot contributor Vishesh Raisinghani has no place in any of the shares talked about.
Robin Brown: Brookfield Asset Administration
In unsure markets, Brookfield Asset Administration (TSX:BAM.A)(NYSE:BAM) seems to be like an ideal fortress inventory to personal. With over $600 billion of belongings underneath administration, it is among the largest different asset managers on the earth. Its monetary capability, scale, and international administration experience are enabling progress to speed up at present.
Given its contrarian investing fashion, this firm can win in the long run from each bear and bull markets. Administration believes it could possibly double BAM’s intrinsic worth in as few as 5 years. That’s solely a compounded annual progress price of round 15%. Contemplating it has surpassed that price previously few years (even within the pandemic), I believe administration is being conservative and there may very well be much more upside.
Idiot contributor Robin Brown owns shares of Brookfield Asset Administration.
Karen Thomas: Tourmaline Oil
Tourmaline Oil (TSX:TOU) is an oil and gasoline firm whose manufacturing is closely weighted towards pure gasoline. Presently, this firm is benefitting tremendously from hovering pure gasoline costs. It’s my prime choose this month, as a result of I anticipate this up-cycle to play out over the following 12 months or two, offering above common returns for pure gasoline shares.
And so far as pure gasoline shares go, Tourmaline is the perfect. The corporate has a big prolific land place with a large number of low-risk drilling alternatives. Tourmaline survived the lengthy and drawn-out pure gasoline bearish cycle exceptionally nicely. At this time, money flows are hovering and shareholders are benefitting.
The corporate plans on returning a lot of its money circulate generated to shareholders. A particular dividend was already introduced final week. And the corporate signaled that there might be extra to come back, as this pure gasoline producer’s fortunes lastly take a dramatic flip for the higher.
Idiot contributor Karen Thomas owns shares of Tourmaline Oil Corp.
Stephanie Bedard-Chateauneuf: Docebo
Docebo (TSX:DCBO)(NASDAQ:DCBO), a supplier of studying administration methods for medium and enormous enterprise purchasers, is my prime inventory for October.
The final quarter of Docebo topped estimates with income of $25.6 million (up 76% 12 months on 12 months) in comparison with a consensus forecast of $23.1 million.
Docebo launches revolutionary merchandise and extends its geographic presence to increase its buyer base and improve the typical worth of its contracts. It lately opened a brand new workplace in Munich, Germany, to strengthen its aggressive place within the European market.
Its robust second-quarter efficiency, increasing buyer base, and rising common contract worth boosted investor confidence, which, in flip, boosted its share worth.
Idiot contributor Stephanie Bedard-Chateauneuf owns shares of Docebo.
Andrew Button: Suncor Power
I’m usually not a giant power inventory man, however there’s sufficient going for the oil and gasoline sector this autumn that it I’m bullish on Suncor Power (TSX:SU)(NYSE:SU). As of this writing, the worth of WTI oil was $76 — the best it had been since 2018. This excessive worth was the fruits of a 12 months of robust features, throughout which oil costs rose within the first, second, and third quarters.
Suncor lately launched its second-quarter earnings and — shock, shock — the corporate benefitted enormously from excessive oil costs. In Q2, funds from operations (FFO) have been $2.36 billion (up from $488 million), working revenue was $722 million (up from a $1.3 billion loss), and web revenue was $868 million (up from a $614 million loss). These robust outcomes have been largely as a result of rising worth of oil within the second quarter, and the worth of oil is even increased now than it was then, so the third quarter is more likely to be a beat.
Idiot contributor Andrew Button has no place in any of the shares talked about.
Jitendra Parashar: Air Canada
Air Canada (TSX:AC) is my prime choose for October. Its inventory is at the moment buying and selling at $24.36 per share. The biggest Canadian passenger airline firm has seen the devastating impression of the worldwide pandemic since Q1 2020. Consequently, the airline has burnt greater than $6 billion in money within the final six quarters. Even the approval of a authorities monetary support bundle and early indicators of journey demand restoration haven’t been in a position to assist its inventory get well up to now.
Nonetheless, issues have began wanting higher for Air Canada these days, because the Canadian authorities is constant to ease journey restrictions forward of the upcoming vacation season. Easing restriction together with stronger demand may assist the airline firm be on a path to a pointy monetary restoration quickly and drive its inventory increased. Whereas AC inventory has risen by 7% in 2021, it’s nonetheless buying and selling 50% decrease from its 2019 closing worth.
Idiot contributor Jitendra Parashar has no place in any of the shares talked about.
Nicholas Dobroruka: Nuvei
My prime inventory for the month of October is the tech firm Nuvei (TSX:NVEI).
The tech inventory joined the TSX solely 12 months in the past, however shares are already up greater than 200%. It’s additionally now valued as a $20 billion firm.
Nuvei presents its international prospects a variety of various payment-processing options. On-line, in-app, or brick and mortar — it doesn’t matter the situation of the acquisition; Nuvei has an answer for it.
The one knock I've on this progress inventory proper now's its valuation. It’s buying and selling at a frothy price-to-sales ratio of 40. It’s not the costliest tech inventory on the TSX, but it surely’s extremely costly, nonetheless.
I’m anticipating many extra years of market-beating progress for the funds firm, however I’d be ready for a bumpy experience. So long as its buying and selling at this type of valuation, volatility ought to actually be anticipated.
Idiot contributor Nicholas Dobroruka has no place in any of the shares talked about.
Sneha Nahata: Payfare
As our reliance on gig employees continues to extend, I'm bullish on Payfare (TSX:PAY) inventory. Notably, Payfare offers fee options and digital banking companies to gig financial system employees, and stable demand for meals supply and ridesharing signifies that it may proceed to ship strong gross sales, whereas its lively person base may leap additional.
Although its inventory has appreciated quite a bit since going public, I anticipate the uptrend to maintain. Payfare’s partnerships with main marketplaces and platforms, together with DoorDash, Uber, and Lyft, will doubtless increase its person base and, in flip, its revenues. Furthermore, its low acquisition value, giant addressable market, and price optimization augur nicely for future progress.
Idiot contributor Sneha Nahata has no place in any of the shares talked about.
Vineet Kulkarni: Tourmaline Oil
Canada’s main pure gasoline producer inventory Tourmaline Oil (TSX:TOU) has returned 160% this 12 months. I believe its lately launched upbeat steerage ought to present one other massive nudge to the inventory, additional rewarding shareholders.
Tourmaline Oil elevated its manufacturing and free money circulate steerage for 2021. As well as, the corporate introduced a particular dividend final week, pushed by its better-than-expected efficiency up to now this 12 months. Apparently, rallying gasoline costs may proceed to spice up its earnings within the second half of 2021.
TOU inventory is at the moment buying and selling 9 instances its earnings and signifies an enormous runway for progress. I believe above-average earnings progress and first rate dividends, together with a less expensive valuation, make Tourmaline inventory nothing in need of a steal.
Idiot contributor Vineet Kulkarni has no place in any of the shares talked about.
Amy Legate-Wolfe: Canadian Pacific Railway
It was fairly the saga between Canadian Pacific Railway (TSX:CP)(NYSE:CP) and Canadian Nationwide Railway for the Kansas Metropolis Southern bid. Nevertheless, CP inventory got here out on prime after a thumbs-up from the U.S. Floor Transportation Board. But CP inventory stays down by about 10% as of writing within the final month due largely from the hefty US$31 billion price ticket.
Nevertheless, this makes it a powerful purchase for worth buyers searching for long-term holds. CP inventory will turn out to be the one railway shifting from Canada to Mexico. It goes by heavy oil, gasoline and agriculture centres to choose up additional income. And but it trades at a helpful 17.2 price-to-earnings ratio.
I believe long-term buyers will quickly resolve it’s well worth the watch for CP inventory and can look previous the worth tag as soon as income floods in. So, that makes at present a stable purchase for this rail firm.
Idiot contributor Amy Legate-Wolfe owns shares of Canadian Pacific Railway.
Jed Lloren: Nuvei
My prime inventory for October is Nuvei (TSX:NVEI). Since its IPO a couple of 12 months in the past, Nuvei inventory has seen many extra inexperienced days than crimson. Consequently, it’s now buying and selling greater than 216% increased than its closing IPO worth. Sadly for buyers, because of this the inventory hasn’t offered many nice shopping for alternatives.
Nevertheless, with the present correction within the inventory market, Nuvei inventory is now buying and selling greater than 16% down from its all-time highs. Regardless of its steep lower in worth, Nuvei stays a prime progress inventory. The corporate reported a 114% year-over-year improve in its Q2 quarterly income. It’s a good time to think about beginning a place within the firm.
Idiot contributor Jed Lloren has no place in any of the shares talked about.
Puja Tayal: Air Canada
My prime TSX inventory choose for October is Air Canada (TSX:AC). The journey restrictions have eased for totally vaccinated people. A majority of persons are reserving flights for his or her long-delayed worldwide journey. Because the vaccination price will increase, so will journey demand. That is the second most airline buyers have been ready for — to purchase the dip earlier than the inventory rallies.
Air Canada inventory has nonetheless not priced within the restoration in air journey demand. However when it does, the inventory may surge double digits and contact its pandemic excessive of $31, representing a 25% upside.
Idiot contributor Puja Tayal has no place in any of the shares talked about.
Daniel Da Costa: Boardwalk REIT
My prime inventory suggestion for October is Boardwalk REIT (TSX:BEI.UN). Boardwalk is a residential REIT with greater than 33,000 suites in 5 provinces throughout Canada. Nevertheless, over 50% of its portfolio is positioned in Calgary and Edmonton.
These two cities have had a number of the poorest housing market fundamentals in Canada, which has led Boardwalk REIT to turn out to be extraordinarily low-cost. So, because the financial system continues to get well, Boardwalk REIT presents buyers a superb alternative.
At present costs, Boardwalk is buying and selling at a price-to-book ratio of simply 0.8 instances and has a secure yield of roughly 2.1%. And, along with all the worth it presents at present, Boardwalk additionally has a tonne of natural progress potential over the approaching years, making it among the best shares to purchase now.
Idiot contributor Daniel Da Costa has no positions in any of the shares talked about.
Ambrose O’Callaghan: Canadian Pure Assets
My prime inventory for October 2021 is Canadian Nationwide Assets (TSX:CNQ)(NYSE:CNQ). The Calgary-based firm is engaged within the manufacturing of crude oil, pure gasoline, and pure gasoline liquids. Oil and gasoline costs have rebounded properly within the very starting of the autumn. Shares of Canadian Pure Assets have climbed 45% in 2021 on the time of this writing.
In Q2 2021, the corporate posted robust progress in adjusted earnings and money circulate. It final paid out a quarterly dividend of $0.47 per share, which represents a stable 4.1% yield. Higher but, it possesses a beneficial price-to-earnings ratio of 13. This undervalued power inventory is value concentrating on to kick off the brand new season.
Idiot contributor Ambrose O’Callaghan has no place in any shares talked about.
Demetris Afxentiou: Canadian Nationwide Railway
There are rising indicators of volatility out there which have weighed on my prime inventory choose for this month. For October, that prime choose is Canadian Nationwide Railway (TSX:CNR)(NYSE:CNI).
CN operates the biggest railroad in Canada and one of many largest in North America. In truth, it’s the one railroad on all the continent with entry to a few totally different coastlines. That huge community is liable for hauling upwards of $250 billion value of products yearly. This makes it the last word long-term defensive inventory with a dependable income stream.
If that weren’t a compelling sufficient case, there’s nonetheless extra to like. After loads of drama, the potential for CN shopping for one up of its cross-border friends in an costly deal is lastly over. To that finish, buyers might be happy that CN can now resume share buybacks of this defensive gem.
Even higher, buyers can anticipate one more tasty dividend hike to comply with subsequent 12 months.
Idiot contributor Demetris Afxentiou owns shares of Canadian Nationwide Railway.
Aditya Raghunath: ARC Assets
My prime inventory for October 2021 is ARC Assets (TSX:ARX). A mid-cap firm valued at a market cap of $8.3 billion, ARC Assets explores, develops, and produces crude oil, pure gasoline, and pure gasoline liquids in Canada.
The inventory is nicely poised to outpace the broader markets in October 2021 and past, as its income is forecast to greater than double to $3.48 billion this 12 months and rise by 17.8% to $4.1 billion in 2022. Comparatively, its backside line is forecast to enhance from a loss per share of $1.55 in 2020 to earnings of $1.45 per share in 2022.
It is among the most cost-effective power shares on the TSX that additionally presents buyers a ahead yield of two.4%.
Idiot contributor Aditya Raghunath has no place in any shares talked about.
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