2 Top Stocks to Buy Without Hesitation in December 2023

These top stocks offer a huge opportunity in a recovering market, allowing investors to buy without hesitation as we head into 2024.

Amy Legate-Wolfe ❯

@amylegatewolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest.

Published December 11, 2023 3:30 pm EST

The market is changing, and that means it’s time to start looking at top stocks for the new year. Especially ones that perhaps weren’t doing so well, but are in for a strong 2024. So today, we’re going to look at what’s been changing in the market, along with two top stocks to consider as it potentially starts to rebound even more.

Times are changing

The Bank of Canada came out last week stating that it would be keeping interest rates at 5%. Now, not only does it look like the next announcement won’t be a rate hike, it’s looking as if we could potentially see a rate drop in the near future.

This is why real estate investment trusts (REIT) could be a strong choice for 2024. Analysts are becoming even more confident that there will be several rate cuts in 2024, and therefore a soft landing will be on the books for investors with top stocks.

Because of this, REITs look like they are trading at a huge value right now. As rate cuts occur, there should be an increase in share price for strong REITs. In fact, some analysts believe that there should be a 10% or even 20% increase in share price for some REITs in 2024 – particularly for multi-family homes, retail, industrial, and office properties.

InterRent

A top recommendation among analysts for this eventuality then includes top stocks like InterRent REIT (TSX:IIP.UN). The dividend stock continues to focus its attention on urban markets, ones that have seen growth thanks to more rental growth in hand. Now, it’s expected to deliver funds from operations growth in 2024.

Yet, shares of IIP stock trade at incredible values. It currently offers a 2.98% dividend yield, and shares are just up 1% in the last year. InterRent has also come down quite a bit from 52-week highs, but is showing signs of strength more recently.

Shares of IIP stock are now up about 10% in the last two months. So as it continues to rebound, there should be even more growth for investors to look forward to. In fact, the stock now has a consensus price target of $14.23 by analysts. That would create a potential upside of 13% as of writing.

Killam

Then we have Killam Apartment REIT (TSX:KMP.UN), which has also received strong recommendations from analysts among top stocks today. Analysts believe the stock should continue to see strong top-line growth going into 2024, and that should speed up as we make it through the year. With that in mind, the stock seems “deeply discounted” in the words of one analyst.

The dividend stock is the perfect choice for those projecting more growth in the rental space for 2024. And that should certainly be the case. And Killam stock remains one of the largest residential real estate trusts on the market. The stock should continue to expand throughout 2024, while offering plenty of value on the market today.

Killam stock now offers a 3.94% dividend yield, with shares trading at just 8.2 times earnings. Shares are up 8% in the last year. However, there was a major jump of about 14% after its latest earnings release. So now could be a great time to pick it up on a consensus price target that could lead to a potential upside of 18% as of writing.