What are we looking for?
Canadian companies that have demonstrated pricing power by expanding margins while increasing sales.
The screen
Despite recent slowdowns in inflation, price growth remains elevated relative to prepandemic norms and consumers continue to face higher prices. For investors, pricing power, the ability to raise prices without diminishing demand, is a robust sign of resilience. Companies with this strength not only protect their profitability but also signal competitive advantages in their business models.
To identify growing Canadian companies with pricing power, I used the screening tool from FactSet, a financial data and analytics provider, and applied the following parameters:
- Traded on the S&P/TSX Composite
- Market capitalization greater than $1-billion
- Three-year annualized sales growth greater than 10 per cent
- Three consecutive years of gross margin expansion
- Forecast sales and earnings growth next year
The six remaining companies were ranked by a multifactor ranking of three-year annualized sales growth and gross margin growth, and one-year forecast sales and earnings growth.
What we found
Cameco Corp. CCO-T, the world’s largest publicly traded uranium producer, ranked No. 1 on our screen and has benefited from a multiyear recovery in uranium markets. Uranium prices, which were below US$30 a pound just five years ago, have surged past US$70 in 2025 as demand for nuclear energy grows and supply remains constrained. Cameco’s vertically integrated model and control of high-grade reserves have generated a 24.4-per-cent margin in its most recent annual report, leading all others on our screen. Analysts expect further upside, with forecasted earnings per share growth above 300 per cent next year, reflecting both firm pricing and growing demand from utilities.
Celestica Inc. CLS-T, a Toronto-based supply-chain technology company, ranked No. 2 on our screen with a 272-per-cent one-year return. Revenue has grown at a 23.5-per-cent annualized rate over the past three years, benefiting from its positioning in high-growth sectors such as aerospace, health technology and data centre infrastructure. Analysts expect 54.2-per-cent earnings growth in the next year and continued margin expansion, reflecting Celestica’s ability to capture demand while maintaining pricing discipline.
The information in this article is not investment advice. The author assumes no liability for any consequence relating directly or indirectly to any action or inaction taken based on the information contained above.
Arjun Deiva, CFA, is an MBA candidate at the University of California, Berkeley, Haas School of Business.
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