These 4 Stocks Have Plenty of Room to Run

Four TSX stocks have delivered market-beating returns, despite elevated volatility in 2023 and their upward momentum seems unstoppable.

| More on:

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

Canada’s primary stock market has been resilient this year, although the threat of more rate hikes could further heighten volatility. Nonetheless, the TSX has produced winning investments in 2023.

Celestica (TSX:CLS), North American Construction Group (TSX:NOA), or NACG, Ag Growth International (TSX:AFN), and Stella-Jones (TSX:SJ) have market-beating returns but still have plenty of room to run. The four stocks should be on investors’ watchlists, if not buy lists, this September.

Tech sensation

Celestica is the tech sensation in 2023, beating e-commerce giant Shopify year to date with its astounding 108.91% return ($31.88 per share). The $3.8 billion electronics component company provides end-to-end product lifecycle solutions and related supply chain services.

Created with Highcharts 11.4.3Celestica PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.ca

It caters to markets such as aerospace & defence, capital equipment, communications, energy, health technology, and industrial & smart energy. Its president and chief executive officer (CEO) Rob Mionis said, “Our diversified portfolio is driving revenue growth and margin expansion despite softness in the Semi Capital Equipment market.”

In the first six months of 2023, revenue and net earnings increased 15% and 39.7% year over year to $3.77 billion and $80.2 million. Mionis expects the strong performance to continue into 2024 because all its markets are well positioned for growth.

  • We just revealed five stocks as “best buys” this month … join Stock Advisor Canada to find out if Celestica Inc. made the list!

Strong fundamentals

NACG operates in Canada’s resources and construction industries, and the stock enjoys investors’ confidence amid the challenging environment. At $32.41 per share, they are up 81.29% year to date.

Created with Highcharts 11.4.3North American Construction Group PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.ca

The $866.62 million company energy constituent owns a large, diverse equipment fleet and is considered a construction and mining heavyweight in the region. Besides Canada and the United States, NACG operates in the continent down under. It recently announced a definitive agreement to acquire MacKellar Group, Australia’s largest privately owned mining equipment and services provider.

Business fundamentals remain strong, as evidenced by the financial results thus far in 2023. In the first half of this year, revenue and net income rose 26.5% and 61.8% year over year to $436.2 million and $34.1 million. Besides the continuing demand for heavy construction and earth-moving services, management expects commodity prices in their markets to remain stable for the rest of the year.  

Viable options

Ag Growth International and Stella-Jones deserve consideration for their sustained business momentum. The former supplies the world’s food infrastructure, while the latter is North America’s premier provider of pressure-treated wood products. The stocks’ year-to-date gains are 33.6% ($57.59 per share) and 30.27% ($62.46 per share), respectively.

In the first half of 2023, AGI’s profit soared 116.6% to $39.7 million versus the same period in 2022. Its president and CEO Paul Householder anticipates sustained margin expansion through 2024 due to manufacturing efficiency, centralized procurement, structured pricing programs, and workforce optimization.

Created with Highcharts 11.4.3Ag Growth International PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.ca

Stella-Jones’s three-year growth plan is underway, and it benefits from the accelerating demand for infrastructure-related products. In the second quarter (Q2) of 2023, sales and net income increased 7.2% and 6.4% to $972 million and $100 million compared to Q2 2022.

Its president and CEO Eric Vachon said Stella-Jones continues to benefit from higher pricing dynamics for utility poles, railway ties, and industrial products. The company also has the agility to manage capital projects, acquisitions, and strong organic growth.

Created with Highcharts 11.4.3Stella-Jones PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.ca

Stellar performances

The stellar performances of the four stocks indicate that not all companies are totally sensitive to higher borrowing costs. Except for high-flying Celestica, NACG (1.2%), Ag Growth International (1%), and Stella-Jones (1.46%) pay modest dividends. Take your pick.

Should you invest $1,000 in Ag Growth International right now?

Before you buy stock in Ag Growth International, 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 Ag Growth International 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 $21,345.77!*

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 24 percentage points since 2013*.

See the Top Stocks * Returns as of 4/21/25

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 Christopher Liew has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Shopify. The Motley Fool recommends Ag Growth International and Stella-Jones. 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

Investing

May the 4th be with you – Motley Fool Edition

Celebrate May the 4th with timeless investing lessons from the Star Wars universe—The Motley Fool way. Patience, compounding, and clarity…

Read more »

Hourglass and stock price chart
Investing

Where I’d Allocate $10,000 in Canadian Value Stocks for Future Growth

Here's where I'd allocate $10,000 in Canadian value stocks for future growth.

Read more »

Canadian dollars are printed
Dividend Stocks

Beat the TSX With These Cash-Gushing Dividend Stocks

Learn how recent macro events have affected stocks on the TSX, and find out which stocks are thriving despite challenges.

Read more »

dividends grow over time
Dividend Stocks

How I’d Build a $15,000 Portfolio Around These 3 Blue-Chip Dividend Stocks

Dividend stocks are one thing, but blue-chip dividend stocks are some of the top options out there.

Read more »

rising arrow with flames
Stocks for Beginners

How I’d Invest $5,500 in Canadian Industrial Stocks to Grow My Portfolio Exponentially

Here are two overlooked industrial stocks you can buy now and hold for the long term to supercharge your portfolio.

Read more »

TFSA (Tax-Free Savings Account) on wooden blocks and Canadian one hundred dollar bills.
Dividend Stocks

TFSA Investors: 2 TSX Stocks to Buy for Dividend Income

These stocks have increased their dividends every year for decades.

Read more »

exchange traded funds
Dividend Stocks

2 Rock-Solid Canadian ETFs to Safeguard Your Portfolio During Trump’s 90-Day Tariff Pause

BMO Low Volatility Canadian Equity ETF (TSX:ZLB) and another ETF were built for tougher market sledding.

Read more »

people relax on mountain ledge
Dividend Stocks

3 TSX Dividend Stocks to Buy for TFSA Passive Income

These stocks trade at reasonable prices and offer high dividend yields.

Read more »