Analysts at Desjardins Securities revealed their top stock picks for 2026 on Friday, reaffirming they are “broadly constructive” on equities and continuing to advocate for global diversification while warning the first half of the year could bring volatility.
It first looked back at the year that’s coming to a conclusion.
“The TSX looks set to close the year up over 25 per cent on strong performance in materials (up over 95 per cent) and financials (up over 29 per cent), as well as the consumer discretionary sector (up over 27 per cent), fuelled in part by lowering interest rates and increasing global risks. The exceptional performance in the materials sector was led by a resurgence in metals/mining, notably gold and copper producers. Financials saw robust earnings, driven by net interest margin improvements and lower loan-loss provisions. Bank stocks’ outperformance became a major TSX driver. Consumer discretionary stocks benefited from lower interest rates (BoC cuts to 2.25 per cent from 3.75 per cent) reducing borrowing costs, and wage growth and stable employment fuelling discretionary purchases,” Desjardins said.
Royce Mendes, the firm’s managing director and head of macro strategy, thinks President Donald Trump’s “Liberation Day” marked “a turning point, as the U.S. shifted from being an anchor of stability to a source of instability, prompting many investors to reassess their exposure to U.S. assets.“
“That reassessment fueled a broader rotation toward equities and bonds in the rest of the world.”
Looking forward, he expects this trend to persist into 2026, “with equity indices outside of the U.S. proving in 2025 that there is outperformance to be had in places other than America,” he added.
“U.S. equity performance will continue to be dominated by the tech space and we are cautious that inflated capex budgets and debt issuance will raise the stakes for companies to turn lofty expectations into satisfactory earnings. With policy increasingly focused on domestic priorities across major economies, global markets have become less synchronized—a dynamic that should continue to facilitate asset allocation away from the U.S."
Mr. Mendes expects uncertainty around the Canada-United States-Mexico Agreement (CUSMA) will “keep uncertainty high for much of the year,” despite expecting an agreement to be reached that does not alter the major parts of the deal. He also thinks the 2025 federal budget will “add a fiscal tailwind to economic activity, but that probably will not show up in a meaningful way until 2H26.”
With that backdrop, Desjardins’ analysts selected 27 equities that should be on investors’ radar for 2026 (click here for last year’s list for 2025). They are:
Consumer Staples/Consumer Discretionary
* Gildan Activewear Inc. (GIL-T) with a “buy” rating and $95 target. The average on the Street is $100.55, according to LSEG data.
Analyst Chris Li: “At approximately 14 times EPS, we believe valuation is attractive vs GIL’s expectation for more than 20-per-cent CAGR [compound annual growth rate] (three-year) and strong FCF conversion supporting an increase in capital return. We believe depressed valuation reflects a wait-and-see perspective from investors for better visibility on the HBI integration and synergies. Following the recent closing of the deal, we expect management to provide more details, likely with 4Q results in February. This could be a catalyst. We believe the majority of the EPS growth is ‘controllable’ (cost synergies, debt refi, share buyback, etc) with upside to cost synergies. Another potential catalyst is the divestiture of non-core/underperforming assets that would accelerate debt reduction, enabling GIL to recommence its NCIB sooner.”
Diversified Industries
* CareRX Corp. (CRRX-T) with a “buy” rating and $4.50 target. Average: $4.58.
Analyst Gary Ho: “We are bullish on CRRX based on: (1) robust secular growth in LTC demand, fuelled by Canada’s aging population; (2) a potential three-bagger in five years—with bed count growth back into positive territory, we believe achieving 140,000 beds by 2030 is realistic, especially if CRRX wins back the Extendicare contract; (3) EBITDA margin approaching the 10-per-cent target by 2026, supported by scale benefits from its two mega-facilities, procurement synergies and delivery service efficiencies; and (4) the specialty/institutional pharmacy market is set for consolidation, positioning CRRX as both potential acquirer and target."
* KITS Eyecare Ltd. (KITS-T) with a “buy” rating and $23 target. Average: $25.90.
Analyst Frederic Tremblay: “KITS is a preferred name based on: (1) its proven growth track record and multiple opportunities for 2026 and beyond, supported by existing infrastructure; (2) business resilience, supported by the widespread medical necessity of eyecare and KITS’ large base of loyal customers; (3) strong financial position, with expectations that the company will be debt-free by the end of 2025 and will continue generating free cash flow and providing optionality for incremental growth opportunities; and (4) valuation discount and mid- to long-term potential for the share price to double or triple.”
* Zedcor Inc. (ZDC-T) with a “buy” rating and $7.50 target. Average: $7.38.
Mr. Ho: “We continue to like ZDC, driven by: (1) significant white space for growth in North America, with more than 1.1m potential sites according to our in-depth TAM analysis; (2) accelerating US market expansion, with a potential blue-chip client win over the next 12–24 months; (3) robust M&A activities in the VSaaS market, positioning ZDC as an attractive take-out candidate—supported by its leading market position, robust revenue growth, solid EBITDA margins and exposure to attractive industry tailwinds; and (4) rising adoption of ZDC’s surveillance solutions as a weak macro environment drives higher crime and theft risks."
Financial Services
Banks
* Canadian Imperial Bank of Commerce (CM-T) with a “buy” rating and $135 target. The average is $127.21.
Analyst Doug Young: “After nine consecutive quarters of EPS beats, CM has been rebranded as the bank of ‘no surprises’. As we look forward, we do not expect any material change to CM’s strategy under its new CEO. In FY26, we expect the bank to deliver consistent performance across NIMs, expenses, credit and buybacks. The bank is on track to achieve its 15-per-cent-plus cash ROE target. All of this is why we believe it deserves a premium multiple..”
* Toronto-Dominion Bank (TD-T) with a “buy” rating and $133 target. The average is $125.09.
Mr. Young: “2025 was a transformative year for TD as its new CEO swiftly addressed investor concerns on the US AML issue, sold the Schwab stake and committed to buying back stocks (not acquisitions) with the capital that was freed up from the sale. At its September 2025 investor day, management provided a clear message and reaffirmed its medium-term adjusted ROE target of 16-per-cent-plus (along with a slew of new guidance items). In FY26, we like: TD’s focus on maintaining a strong position in Canadian banking; the potential for earnings upside in US retail banking; the potential for growth in capital markets from further leveraging the U.S. Cowen business; another year of support from $6–7-billion-plus in stock buybacks. Assuming it delivers on all of the above, we see room for valuation multiple expansion (we view TD’s valuation as attractive)."
Lifecos
*Manulife Financial Corp. (MFC-T) with a “buy” rating and $55 target. The average is $55.06.
Mr. Young: “There are four themes we like and, if management delivers, we believe there is room for further valuation multiple expansion. These themes are: (1) core earnings growth across its Asian franchise; (2) momentum in Canada under its new refreshed strategy; (3) reinsuring more lower-ROE legacy businesses, although we do expect less activity on this file vs the past year and a half; and (4) stock buybacks. It’s as simple as that! ”
* Sun Life Financial Inc. (SLF-T) with a “buy” rating and $94 target. The average is $91.30.
Mr. Young: “There are several themes we like, including: (1) a peer-leading medium-term underlying ROE target of 20 per cent; (2) several potential earnings growth drivers over the coming year(s)—improved U.S. dental results, potentially more stable U.S. stop-loss results, momentum in Asia, SLC Management hitting its stride and stock buybacks; (3) $6-billion in excess capital and debt capacity (excludes capital earmarked for SLC buyups in 2026), and it generates an attractive amount of excess capital annually; and (4) valuation— we believe concerns with U.S. dental, US stop-loss and MFS are more than factored into SLF’s current valuation."
P&C Insurance
* Trisura Group Ltd. (TSU-T) with a “buy” rating and $56 target. The average is $57.
Mr. Young: “There are three themes we like: (1) growth outlook for surety and warranty, two of its larger businesses (represents 45 per cent of TSU’s underwriting profits); (2) management’s belief that reserve bumps in U.S. fronting are in the rearview mirror; and (3) valuation—we believe the Canadian division alone is worth $35–40 per share."
Industrials/Transportation & Aerospace
* CAE Inc. (CAE-T) with a “buy” rating and $51 target. The average is $44.
Analyst Benoit Poirier: “In Aerospace & Defence, as well as overall, CAE is our favourite idea given its new CEO, new chairman, green shoots in pilot hiring, surging global defence spending, a red-hot bizjet market and structurally irreplaceable assets. The setup reminds us of BBD and ATRL in the early stages of their turnaround journeys. While financial targets are pending, we see potential for Civil EBIT margins at 25 per cent and Defence at 11–12 per cent. Applying these assumptions, along with a modest multiple expansion, yields a bullcase valuation of $64/share (or $69/share if we include buybacks). This scenario would effectively enable CAE to more than double its earnings within 3–4 years"
* TFI International Inc. (TFII-T) with a “buy” rating and $170 target. The average is $145.20.
Analyst: “In Transportation, TFII stands out for its consolidation potential (in contrast to CN, CP and CJT), greater exposure to the U.S. (70 per cent of revenue), less cross-border/tariff exposure, a superior 2027 FCF yield (11 per cent vs 3–5 per cent for the rails) and unique non-market-reliant self-help catalysts at TForce Freight. Importantly, while upside does not depend solely on a trucking rebound, we are starting to see early signs of a potential capacity crunch as driver regulatory enforcement is heightened in both the US and Canada."
Metals & Mining
Gold
* Torex Gold Resources Inc. (TXG-T) with a “buy” rating and $90 target. The average is $82.94.
Analyst Allison Carson: “With the Media Luna build completed in 2025 and the mine ramping up well, we expect 2026 to be a strong year for Torex. The Media Luna build was completed relatively on time and on budget, a testament to the Torex team. With the tie-in for the copper circuit completed in 1Q25, the company has continued to ramp up mining rates through the year and is expected to reach 7,500tpd by midnext year. In 2026, we expect production to increase 10 per cent year-over-year, with mining at Media Luna ramping up. While executing a smooth ramp-up, Torex also continued to demonstrate the growth potential on its Morelos land package through exploration. We believe this property could host up to 20moz and will make this a multi-decade mining district.”
Silver
* Aya Gold & Silver Inc. (AYA-T) with a “buy” rating and $32 target. The average is $25.
Analyst Bryce Adams: “In ramping up its operating mine, Zgounder, in Morocco, Aya has had a busy 2025 and one that sets the table for strong results in 2026. In our view, 3Q25 results highlighted operational momentum for Zgounder production rates and that 4Q25 results will continue to be strong and offset slower results in 1H25. We view this as operational strength into year-end and as achieving its key milestone of hitting annualized production of close to 6moz.”
* Americas Gold and Silver Corp. (USA-T) with a “buy” rating and $9.50 target. The average is $6.38.
Ms. Carson: “Americas has undergone a transformative year, with new management in place (led by CEO Paul Huet) and it being the first full year with Galena 100% consolidated. At Galena, employee turnover has improved, mining rates have increased and significant upgrades have been made. Work completed should set the basis for a stronger year ahead with our estimated 2026 silver equivalent production at 3.5moz, more than double our 2025 production estimate.”
Copper
* Capstone Copper Corp. (CS-T) with a “buy” rating and $18.50 target. The average is $14.52.
Mr. Adams: “We carry over Capstone Copper as a top pick from 2025 into 2026. Capstone traded well in 2025 but overall traded below its peer group. Capstone is up 44 per cent year-to-date and up 97 per cent since April 3 (when we initiated coverage); these are strong results, but relatively below COPX (Copper Miners ETF) at up 76 per cent year-to-date and up 84 per cent since April 3. In our view, 2025 has been a year of transition for Capstone, mostly for the ramp-up of the Mantoverde sulphide concentration plant. Operational results were impacted by transitional ore types and ball mill motor failure."
Uranium
* Denison Mines Corp. (DML-T) with a “buy” rating and $5.50 target. The average is $4.46.
Mr. Adams: “In 2025, we ranked Cameco as our top pick; into the next year, we view Denison as best positioned to benefit from ongoing strength in nuclear and uranium markets. With the previously announced US$345-million convertible note update, we view Denison as fully funded for construction of its cornerstone Phoenix ISR project (95 per cent) in the Athabasca Basin, Saskatchewan. Phoenix, the first deposit at Wheeler River, is a high-grade, fast-payback project, and should be fully permitted by 1Q26. Gryphon is a second deposit at Wheeler River and is a conventional underground and longer-dated growth option.”
Oil & Gas
* Cenovus Energy Inc. (CVE-T) with a “buy” rating and $33.50 target. The average is $31.73.
Analyst Chris MacCulloch: “For a third consecutive year, we are highlighting CVE as a top pick. Following a challenging start to 2025 marked by a $400-million loss in the U.S. downstream segment, the company began gaining traction over the summer months as investor focus began shifting toward its core operational strength— thermal in situ oil sands development, which ultimately set the stage for its successful acquisition of MEG Energy. To call the MEG acquisition a strategic gamechanger for CVE would be an understatement to the extent that the transaction granted the company full control over Christina Lake, including the ability to apply its operating model and a more comprehensive asset development strategy."
* Rockpoint Gas Storage Inc. (RGSI-T) with a “buy” rating and $34 target. The average is $32.34.
Mr. MacCulloch: “We are highlighting RGSI as a top pick after recently initiating coverage. The stock has posted strong gains on the back of its highly successful IPO, and we believe that momentum will carry forward into 2026 given supportive market conditions and internal business drivers. Although RGSI represents a special situation within our predominantly upstream coverage universe, we believe the stock provides a unique opportunity for investors to gain access to structurally tightening North American natural gas storage capacity while providing attractive one-way exposure to price volatility.”
Power & Utilities
* Boralex Inc. (BLX-T) with a “top pick” designation and $38 target. The average is $35.
Analyst Brent Stadler: “For BLX, we expect a cash flow inflection into 2026 as the company expects to complete 615MW of projects in 2025 and believe RFP wins in 2026 and 2027 will be accretive to NAV and secure BLX’s targeted 8–10-oer-cent FCF/sh CAGR out to 2030. We continue to believe that high-quality, long-term contracted renewable platforms are undervalued in the public markets, and therefore BLX remains our Top Pick.”
* Capital Power Corp. (CPX-T) with a “buy” rating and $80 target. The average is $77.44.
Mr. Stadler: “We continue to view CPX as largely a U.S. story and expect it will continue to execute on U.S. catalysts, potentially announcing a 250MW data centre agreement at Midland and a long-term PPA at the 1.1GW La Paloma facility to name a few near-term opportunities. Entering into long-term contracts is part of CPX’s master plan to drive multiple expansion on gas assets by changing the way lenders view the asset class and increasing leverage, which should also provide more dry powder for growth. We believe the recent recontracting of Midland is a big step toward achieving this master plan and is supportive of multiple expansion on gas assets.”
* Algonquin Power & Utilities Corp. (AQN-T) with a “buy” rating and US$7 target. The average is US$6.54.
Mr. Stadler: “We are quite excited for AQN as we head into 2026 as we expect the turnaround story to really start to prove itself out. We believe the Empire rate case is effectively complete and it is just a matter of time before the Missouri Commission approves the settlement, which should largely derisk guidance. Additionally, we found the Missouri Commission’s comments quite favourable in that if AQN can continue to make improvements to customer service, the commission will support the company’s goal of becoming a premium utility, which bodes well for future rate cases in our view.”
Real Estate
* Flagship Communities REIT (MHC-U-T) with a “buy” rating and US$24 target. The average is US$23.05.
Analyst Kyle Stanley: “Relatively stable low-teen year-over-year FFOPU growth and continued outperformance vs its U.S. peers should enable it to further close the valuation gap.”
* Granite REIT (GRT-UN-T) with a “buy” rating and $95 target. The average is $88.75.
Mr. Stanley: “Its blue chip U.S. exposure offers a more defensive and accelerating 8-per-cent FFOPU growth profile within the industrial sector, where our conviction has continued to improve.”
* Nexus Industrial REIT (NXR-UN-T) with a “buy” rating and $9 target. The average is $8.25.
Mr. Stanley: “We believe that investors with a higher risk tolerance should take advantage of 2026 as the inflection year for growth.”
* Sienna Senior Living Inc. (SIA-T) with a “buy” rating and $24 target. The average is $22.38.
Analyst Lorne Kalmar: “With sector-leading forecast AFFOPS growth and accelerating earnings growth in 2026 vs 2025, we expect the stock to continue to re-rate higher."
Telecom, Media & Tech
* BCE Inc. (BCE-T) with a “buy” rating and $42 target. The average is $36.06.
Analyst Jerome Dubreuil: “BCE is our #1 telecom pick. With a clear corporate strategy, management appears ready to execute on the turnaround. We expect investors’ focus will shift to more positive aspects of the story with the increased transparency/visibility, potentially positive EBITDA growth in Canada in 2026, Ziply execution and momentum in B2B (including AI initiatives). We see valuation upside at BCE and believe the name is under-owned, which should become more apparent once tax-loss selling season is over.”
* Lumine Group Inc. (LMN-X) with a “buy” rating and $52 target. The average is $49.
Mr. Dubreuil: “LMN is our best IT services, software and other tech idea. A part of this call lies in our view that software companies with resources, drive and foresight (such as the Constellation family) will successfully navigate the AI transition. We believe the recent resumption of M&A activity at LMN will show that little has changed at the company despite the stock being down 47 per cent from all-time highs. Resilience to AI could also support our IT services coverage of GIB and ALYA. Finally, we believe the benefits from FAST channels momentum and the TuneIn acquisition should make 2026 another strong year for RAY.”