As the year draws to a close, investors awaiting a so-called Santa Claus Rally may be focused on which companies may benefit the most from an end-of-year surge in the stock market. Indeed, December happens to historically be one of the best months for investors, for a number of reasons. But aside from typical seasonal catalysts, this year has brought a number of other potential catalysts to the fore for investors.
Whether it's the Trump win last month or an improving outlook for 2025, various stocks appear poised to ride a wave of enthusiasm higher into the New Year. Here are three top Canadian stocks I've got on my radar right now that may do just that.
Restaurant Brands
Restaurant Brands (TSX:QSR) is the parent company of Tim Horton's, Burger King, and Popeyes. As such, the company has become a stalwart in the quick-service restaurant industry. With its global footprint and strong brand equity, the brand is poised to perform well during the holiday season and beyond.
Despite economic uncertainties, the demand for quick-service dining remains robust, particularly during the holiday rush when families opt for fast and convenient meal options. Impressively, Restaurant Brands reported system-wide sales of $11.4 billion in its most recent quarter, driven by same-store sales growth and new restaurant openings.
The company is aggressively expanding into international markets, including Asia and the Middle East, diversifying its revenue base. In addition, Restaurant Brands offers a dividend yield of approximately 3.3%, making it appealing for income-seeking investors during the rally. With its strong financial performance and global growth strategies, the company is well-positioned to ride the holiday market wave.
Fortis
Fortis (TSX:FTS) is one of North America's largest regulated utility companies. The stock is a safe bet for investors seeking stability during market volatility. The company operates in electric and gas utilities across Canada, the U.S., and the Caribbean.
Fortis, boasting an impressive 50-year track record of dividend increases, is currently yielding around 4%. It makes Fortis Inc. a favourite stock among risk-averse investors. Moreover, Fortis enjoys stable cash flows, even in uncertain economic climates, as a regulated utility in Canada. The company has committed to investing $22.3 billion in its five-year capital plan, focusing on renewable energy and infrastructure upgrades.
With utility stocks often trading at discounts during the year-end, Fortis can see renewed interest during the Santa Claus Rally. Furthermore, Fortis offers stability and long-term growth potential. This makes it an excellent choice for the rally and beyond.
Dream Industrial REIT
Dream Industrial REIT (TSX:DIR.UN) specializes in logistics and warehousing properties, an asset class experiencing a surge in demand due to e-commerce growth and supply chain realignment.
The REIT reported a 98.5% occupancy rate in its portfolio and continues to benefit from rental rate increases across its properties. It has been actively acquiring properties in high-demand regions, including urban hubs and logistics corridors, to capitalize on the boom in online shopping.
Offering a dividend yield of approximately 5.8%, Dream Industrial REIT helps you generate reliable income with the potential for capital appreciation. In addition, with the continued rise of e-commerce and onshoring of supply chains, demand for industrial spaces is unlikely to wane, making Dream Industrial a long-term winner. Dream Industrial is set to deliver solid returns during the rally as a well-managed REIT with exposure to one of the hottest real estate segments.
