Will Canada's primary stock market outperform in 2025? According to the 13th annual forecast of Bank of Montreal strategists, the TSX will do better than its U.S. counterparts next year. "We think Canada offers value and cyclicality and increase in stock picking, especially relative to the U.S.," said Brian Belski, BMO's chief investment strategist.

But what should Canadian investors pick in preparation and include in their shopping lists this month? Belski is bullish about small-cap stocks. He thinks they can do very well over the next decade. As of this writing, the technology sector is the top performer among 11 primary sectors thus far in 2024. Only the communications services sector is losing.

Energy is up 11.41% year to date, although two stocks in the Oil & Gas, Equipment & Services industry stand out. If you have $1,000 to invest right now, CES Energy Solutions (TSX:CEU) and Enerflex (TSX:EFX) are no-brainer options. You can even take positions in both, as the companies have different areas of expertise.

Consumable chemical solutions

CES Energy Solutions provides molecular-level chemical solutions to clients in Canada and the United States. The $2.16 billion company generates free cash flow (FCF) from a low-capital intensity, vertically integrated consumables business model.

At $9.49 per share, current investors enjoy a 179.13% year-to-date gain on top of a modest 1.27% dividend yield (quarterly payout). The financial performance in the third quarter (Q3) of 2024 shows in the stock's performance. Also, CEU is a 2024 TSX30 winner. It ranked fourth in the flagship program for Canada's top growth stocks.

In Q3 2024, revenue increased 13% year over year to record $606.5 million versus Q3 2023. Net income climbed 21% to $46.6 million from a year ago. Both core markets, Canada ($203.9 million) and the U.S. ($402.6 million), set new quarterly revenue records.

Management expects increased service intensity and enhanced drilling activities because of global demand requirements and demand trends of developing countries. CEU Energy maintains a positive outlook despite economic uncertainty and global conflicts. Strong energy industry fundamentals will continue supporting critical oil and natural gas drilling and production activity.

Energy infrastructure solutions

Enerflex provides vertically integrated and comprehensive energy infrastructure solutions to customers in North America, Latin America, and the Eastern Hemisphere. If you invest today, the share price is $13.61 (+124.87% year to date), while the divided offer is 1.33%.

This $1.67 billion energy services company engages in gas treatment, processing, compression, refrigeration, and electric power. The infrastructure segment offers build-own-operate-maintain solutions, water treatment solutions, and integrated turnkey.

In Q3 2024, revenue increased 3.6% to $601 million compared to Q3 2023, a new record for Enerflex. Operating income and net earnings rose 137.5% and 650% year over year to $57 million and $30 million, respectively. The $1.3 billion engineered services backlog indicates visible revenue growth.

Preet Dhindsa, Enerflex's senior vice president and chief financial officer, said the near-term plan is to deploy selective growth capital to customer-supported opportunities in the U.S. and Middle East that can generate attractive returns and deliver shareholder value.

Momentum stocks

CEU Energy Solutions and Enerflex have strong, unstoppable upward momentum heading into 2025. Canadians with limited investment budgets or who have $1,000 to spare can earn two ways: price appreciation and dividends.