3 Top Industrial Stocks to Buy on the TSX Today

These stocks are worth buying today for stability and essential services.

| More on:
A worker overlooks an oil refinery plant.

Source: Getty Images

The industrial sector seldom outperforms during high inflation because of headwinds like higher input costs and reduced demand. Thus far in 2023, the sector is in the green, although the gain is barely 1% (+0.99%). However, three constituents continue to go against the downtrend.

SNC-Lavalin Group (TSX:ATRL) Westshore Terminals Investment (TSX:WTE), and GFL Environmental (TSX:GFL) are worth buying today for stability and essential services. The businesses and essential services likewise contribute to the economy and facilitate trade.

Engineering and construction

Engineering giant SNC-Lavalin has rebranded by changing its name to AtkinsRéalis. Also, its ticker symbol on the TSX changed from SNC to ATRL, effective September 18, 2023. After years of a tainted reputation, the $6.99 billion fully integrated professional services and project management company said it had reached an “inflection” point.

Now, the storyline is entirely different. According to its chief executive officer (CEO), Ian L. Edwards, SNC-Lavalin wants to shed the negative image. He said, “From here, it’s all about growth.” In the first half of 2023, net income from continuing operations soared 263% year over year to $92.1 million.

Edwards credited the success of the “Pivoting to Growth” strategy for the strong second quarter and year-to-date results. The business turnaround shows in the stock’s performance. At $39.82%, ATRL is up 67.18% year-to-date and pays a modest 0.19% dividend.

  • We just revealed five stocks as “best buys” this month … join Stock Advisor Canada to find out if SNC-Lavalin Group made the list!

Marine shipping

Westshore Terminals provides access to all major rail corridors and shipping lanes and is an export revenue generator. The $1.49 billion company operates Canada’s busiest coal export terminal, whose annual volume is more than 33 million tonnes of coal. Current investors enjoy a 10.65% year-to-date gain ($23.89) on top of a generous dividend yield (5.88%).

In the first half of 2023, revenue and profit rose 10% and 21% to $188.5 million and $61 million from a year ago. Cash flows provided by operations increased 29% year over year to $67.3 million. Westshore shipped 13.6 million tonnes during the period, where 63% was thermal coal and 37% was metallurgical coal.

Coal is a vital resource, although Westshore has introduced an $800 million Potash Project to its current coal terminal. It’s a significant diversification move because the company would have another product for the long term. The construction is ongoing, and potash handling should commence in 2026.

Waste management

GFL Environmental operates in Canada and the United States. This $15.35 billion diversified environmental services company undertakes environmental challenges. It offers solid waste management, liquid waste management, and soil-remediation services. This top industrial stock is relatively stable (+5.6% year to date) and trades at $41.69 per share with a corresponding 0.17% dividend.

In the first half of 2023, revenue rose 20% year over year to $3.74 billion, although net income fell 17% to $76 million compared to a year ago. Still, Patrick Dovigi, GFL founder and CEO, said, “We remain focused on executing on our strategy to create long-term shareholder value. We continue to see upside opportunities from our robust M&A [merger and acquisition] pipeline.”

Beating the odds

Some market analysts say the industrial sector has historically underperformed while inflation rises. However, you can’t ignore performers like SNC-Lavalin, which beat the odds. It has delivered considerable gains in one year (74.1%) and should reward investors more after the rebranding.  

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 recommends Westshore Terminals Investment Corporation. The Motley Fool has a disclosure policy.

More on Investing

think thought consider
Tech Stocks

Is CGI Stock a Buy Even With No Dividend Yield?

CGI stock may not have a dividend to speak of. But does that necessarily mean you should ignore this top…

Read more »

A robotic hand interacting with a visual AI touchscreen display.
Tech Stocks

Why Now Is the Time to Invest in Canadian AI Stocks

Are you looking for one of the most solid Canadian AI stocks out there? This one is probably your best…

Read more »

The letters AI glowing on a circuit board processor.
Tech Stocks

Why AI Stocks Should Be in Every Canadian Investor’s Portfolio

AI stocks continue to be one of the best options out there for long-term investing, especially when considering Canadian options.

Read more »

stock research, analyze data
Bank Stocks

Canadian Bank Stocks: Buy, Sell, or Hold?

There are opportunities and risks on the horizon for the Canadian banks.

Read more »

Young Boy with Jet Pack Dreams of Flying
Stock Market

Is Air Canada Stock a Good Buy After Its Q3 Results

Down almost 60% from all-time highs, Air Canada is an undervalued TSX stock that remains an enticing investment in November…

Read more »

cloud computing
Investing

Where to Invest $10,000 in November

Given their solid underlying businesses and healthy growth prospects, I expect these two defensive stocks to outperform uncertain outlook.

Read more »

coins jump into piggy bank
Retirement

Here’s the Average RRSP Balance at Age 44 for Canadians

Holding stocks like Alimentation Couche-Tard (TSX:ATD) in an RRSP is a good way to build your wealth.

Read more »

dividends can compound over time
Dividend Stocks

Want a 7% Yield? The 3 TSX Stocks to Buy Today

These TSX stocks are offering high yields of over 7%, making them attractive for investors seeking steady passive income.

Read more »