Do you want to invest in the Canadian industrial sector but don’t know where to start? With so many options, choosing the best industrial stocks to invest in can be overwhelming. But fear not because I’ve covered you with the top Canadian industrial stocks to consider for your portfolio.
Canada’s industrial sector is a crucial part of its economy, contributing to job creation and economic growth. Moreover, with a strong focus on innovation and sustainability, Canadian industrial companies are well-positioned for long-term success. So, whether you’re a seasoned investor or starting, read on to discover the top Canadian industrial stocks to watch in 2022.
Why invest in Canadian Industrial Stock Sector?
There are several reasons why investing in Canadian industrial stocks can be a good idea:
- Stable and diversified economy: Canada has a stable and diversified economy with a solid industrial sector. The country has a long history of industrial manufacturing and is home to various companies in the aerospace, automotive, construction, and engineering industries. Space exploration companies are also an important aspect of Canada’s industrial companies.
- Strong political and regulatory environment: Canada has a stable political and regulatory environment, which makes it an attractive destination for businesses looking to invest in industrial sectors. The country has a business-friendly environment with a strict rule of law and a transparent regulatory system.
- Access to global markets: Canada has strong trade relationships with countries worldwide, which provides Canadian industrial companies with access to international markets. This can help Canadian companies to grow and expand their businesses beyond the domestic market.
- Innovation and technology: Canadian industrial companies are known for their innovative and technology-driven solutions, which help them stay competitive in a rapidly changing global market. Many Canadian companies are leaders in their respective industries and have a strong track record of developing and commercializing new technologies.
- Growth potential: The Canadian industrial sector is poised for growth, driven by infrastructure spending, government support for innovation and technology, and a shift towards sustainability and clean energy solutions. This creates opportunities for investors to participate in the growth of these industries and potentially realize substantial returns on their investments.
Overall, investing in Canadian industrial stocks can expose investors to a stable and diversified economy, a strong political and regulatory environment, access to global markets, innovation and technology, and growth potential.
The Best Industrial Stocks in Canada
here are 10 Canadian industrial stocks and a brief explanation about why they could be a good investment:
Bombardier Inc. (BBD.B.TO)
Bombardier is a global manufacturer of business jets, commercial aircraft, rail transportation equipment, and related services. The company has a strong presence in the aerospace and transportation sectors and has been improving its financial performance through cost-cutting measures and divestitures. As the aviation industry recovers from the pandemic-related slowdown, Bombardier could benefit from increased demand for business jets and other aircraft.
Canadian Pacific Railway Limited (CP.TO)
Canadian Pacific Railway is a major transportation company that operates a rail network across Canada and the United States. The company has performed well in recent years, with strong revenue growth and solid financials. With the increasing demand for the transportation of goods and commodities, Canadian Pacific Railway could continue to benefit from its competitive position in the rail industry.
Canadian National Railway Company (CNR.TO)
Canadian National Railway is another major transportation company that operates a rail network across Canada and the United States. The company has a strong competitive position in the rail industry and has been investing in technology and infrastructure to improve its operations. As the economy recovers and demand for transportation increases, Canadian National Railway could see continued growth.
WSP Global Inc. (WSP.TO)
WSP Global is a professional services firm that provides engineering, consulting, and project management services across various sectors, including infrastructure, energy, and environment. The company has a global presence, strong technical expertise, and an innovative reputation. With an increasing demand for sustainable infrastructure and renewable energy projects, WSP Global could benefit from its expertise in these areas.
Brookfield Infrastructure Partners L.P. (BIP.UN.TO)
Brookfield Infrastructure Partners is a global infrastructure company that owns and operates assets in the utilities, transport, energy, and data infrastructure sectors. The company has a diversified portfolio of high-quality assets and a track record of delivering solid returns to investors. With an increasing demand for infrastructure investment, Brookfield Infrastructure Partners could continue benefiting from its strong market competitive position.
SNC-Lavalin Group Inc. (SNC.TO)
SNC-Lavalin is a professional services firm that provides engineering, procurement, and construction services across various sectors, including infrastructure, mining, and energy. The company has a global presence and a strong reputation for technical expertise and project execution. With increasing demand for infrastructure investment and renewable energy projects, SNC-Lavalin could benefit from its strong capabilities in these areas.
Magna International Inc. (MG.TO)
Magna International is a global automotive supplier that produces a range of components and systems for vehicles. The company has a solid competitive position in the automotive industry and has invested in new technologies and products to stay ahead of the curve. With increasing demand for electric and autonomous vehicles, Magna International could benefit from its expertise in these areas.
Stantec Inc. (STN.TO)
Stantec is a professional services firm that provides engineering, consulting, and project management services across various sectors, including infrastructure, water, and environment. The company has a global presence and a strong reputation for technical expertise and project execution. With increasing demand for sustainable infrastructure and environmental solutions, Stantec could benefit from its expertise in these areas.
CAE Inc. (CAE.TO)
CAE is a global leader in training and simulation solutions for the aviation, defence, and healthcare sectors. The company has a strong competitive position in the simulation and training market and has invested in new technologies and products to stay ahead of the curve. With increasing demand for aviation and defence training solutions, CAE could benefit from its expertise in simulation services.
Ballard Power Systems Inc. (BLDP.TO)
Ballard Power Systems is a global leader in the design, development, and manufacturing of hydrogen fuel cell products for a range of applications, including transportation, backup power, and material handling. With an increasing demand for clean energy solutions and governments worldwide committing to net-zero emissions targets, Ballard Power Systems could benefit from its leadership in the fuel cell industry.
Aecon Group Inc. (ARE.TO)
Aecon Group is a Canadian construction and infrastructure development company that operates across Canada and internationally. The company has a strong presence in the civil construction, transportation, and nuclear sectors and has invested in new technologies and sustainability initiatives. With increasing demand for infrastructure investment and sustainable construction solutions, Aecon Group could benefit from its expertise in these areas.
ATS Automation Tooling Systems Inc. (ATA.TO)
ATS Automation Tooling Systems is a global provider of automation solutions for various industries, including life sciences, transportation, and consumer products. The company has a strong competitive position in the automation market and has invested in new technologies and products to stay ahead of the curve. With the increasing demand for automation solutions in various industries, ATS Automation Tooling Systems could benefit from its expertise in these areas.
Toromont Industries Ltd. (TIH.TO)
Toromont Industries is a Canadian heavy equipment distributor for the construction, mining, and forestry industries. The company has a solid competitive position in the heavy equipment market and has been investing in new technologies and services to stay ahead of the curve. With increasing demand for heavy equipment in a range of industries, Toromont Industries could benefit from its expertise in these areas.
In conclusion, each Canadian industrial stock represents a different industry sub-sector, from aerospace to transportation to construction and engineering. However, they all have their competitive advantages and opportunities for growth, making them potential candidates for investment depending on an individual’s risk tolerance and investment goals.
How to invest in Industrial Stocks?
There are several ways to invest in industrial stocks:
- Individual stocks: One way to invest in industrial stocks is to buy shares of respective companies. Investors can research and select companies with strong growth potential and buy their shares through a brokerage account. This approach allows investors to control their investments and potentially earn higher returns, but it also requires more research and monitoring.
- Exchange-Traded Funds (ETFs): Another way to invest in industrial stocks is through ETFs, which hold a basket of stocks and trade on an exchange like a stock. Investors can consider several industrial ETFs, such as the Industrial Select Sector SPDR Fund (XLI) or the iShares U.S. Industrials ETF (IYJ). ETFs expose investors to a diversified portfolio of industrial stocks, which can help mitigate risks and provide a convenient and low-cost way to invest in the sector.
- Mutual Funds: Mutual funds are another option for investing in industrial stocks. These funds pool money from multiple investors and are managed by professional fund managers who invest in a portfolio of stocks. Investors can select a mutual fund focusing on industrial stocks or broader sectors, including industrial stocks. Mutual funds provide investors with diversification and professional management, but they also come with higher fees and may have higher minimum investment requirements.
- Robo-advisors: Robo-advisors are digital platforms that provide automated investment management services. Investors can select a robo-advisor that includes industrial stocks in its portfolio and use its services to invest in the sector. Robo-advisors offer investors a low-cost and convenient way to invest in industrial stocks. Still, they may not provide the same level of customization and control as individual stock investing.
Industrials are Always Working
As the economy progresses, industrial stocks can be an appropriate choice for investors. The industrial sector plays a crucial role in driving economic growth. It is expected to grow in the coming years, driven by infrastructure spending, innovation and technology, and a shift towards sustainability and clean energy solutions.
However, as with any investment, it’s essential to research and carefully evaluate the risks and potential rewards before making investment decisions. Investors should consider factors such as the company’s financial health, management team, growth potential, and industry trends when selecting industrial stocks to invest in.
By researching and selecting suitable investments, industrial stocks can provide investors with potential long-term growth and returns.