For 2025, Desjardins analysts have identified 23 stocks from nine different sectors as their top investment choices. (REUTERS/Mark Blinch)
Desjardins has released its 2025 financial outlook, highlighting key factors that could influence the stock market this year: inflation, interest rates, politics, and the broader economy. Following a strong performance in 2024, analysts are split on whether 2025 will continue this upward trend or bring a more cautious environment. Notably, the market awaits the decisions of incoming U.S. President Donald Trump, especially his stance on tariffs that could impact trade relationships and equity markets.
Desjardins identified 23 stocks across nine sectors as top picks for 2025, offering insights into potential growth opportunities amid uncertain conditions.
Consumer Staples and Discretionary
Defensive stocks like Dollarama, Loblaw, and Metro remain strong bets, thanks to their resilience in uncertain economic climates. However, Gildan Activewear stands out, with a predicted earnings-per-share growth of 14%, driven by sales expansion and market share gains. Its share price target is $82, up from its current $67.49.
Diversified Industries
Desjardins' top picks include Boyd Group Services, Brookfield Business Partners, and 5N Plus. Boyd Group, which runs auto repair centers, is set for a better year after 2024’s subdued performance, with a share price target of $226. Brookfield Business Partners, bolstered by its robust asset valuations, has a target of $34. Meanwhile, 5N Plus, a semiconductor producer, is projected to see "brighter days," with a target of $8.75.
Financial Services
As interest rates are expected to drop, banks and insurance firms could benefit. CIBC and Royal Bank of Canada are top banking picks, with targets of $100 and $190, respectively. For insurance, Sun Life and Manulife stand out, with price targets of $95 and $50.
Industrials, Transportation, and Aerospace
Engineering firm AtkinsRéalis and aerospace giant Bombardier are among the favourites in this category. AtkinsRéalis, with a $91 price target, is positioned to thrive in an improving construction environment. Bombardier, boosted by increased demand for private jets, has a share price target of $145. Transportation company TFI International is also well-placed, with a target of $236.
Metals and Mining
Gold is expected to shine again in 2025, making Orla Mining and Probe Gold top choices. Orla Mining is forecasted to reach $10 per share, while Probe Gold targets $3.75, benefiting from a favourable gold price environment.
Oil and Gas
ARC Resources and Cenovus Energy lead this sector with targets of $35 and $30.50, respectively. Desjardins recommends focusing on companies with strong balance sheets and low capital expenditure needs to navigate geopolitical and commodity price uncertainties.
Power and Utilities
The energy sector remains robust, with renewable energy company Boralex ($46 target) and Capital Power ($64 target) among the highlights. Innergex Renewable Energy also makes the list, with a $14 price target.
Real Estate
Chartwell Retirement Residences, Canada’s only pure retirement portfolio, is a standout, with a target of $18 per share. Dream Industrial REIT and RioCan REIT also made the list, with price targets of $16.50 and $23, respectively.
