3 Canadian Stocks to Buy Before the Next Earnings Surprise

When investors try to get ahead of the next earnings surprise, they should usually look for a few simple things. First, they want a business with real momentum, not just a cheap stock. Second, they want a company with a reason to beat expectations, whether that’s stronger demand, expanding margins, or a fresh growth driver the market still underestimates. And third, they want a stock where the story still has room to improve. So, let’s look at three doing just that.

ATZ

Vancouver-based retailer Aritzia (TSX:ATZ) sells fashion under its Everyday Luxury banner and has kept pushing deeper into the United States while also getting more out of digital sales. Over the last year, it kept opening and repositioning boutiques, launched its mobile app, and remained active on the capital side with buybacks and a secondary share offering. None of that changes the core story: demand stayed strong, and the brand kept winning customers even in a tougher consumer backdrop.

The numbers are hard to ignore. In fiscal 2026 third-quarter results, Aritzia stock posted net revenue of $1.04 billion, up 42.8%, while comparable sales jumped 34.3%. For the first nine months, revenue rose 36.5% to $2.52 billion, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) climbed to $425.7 million from $245.5 million, and adjusted diluted earnings per share surged to $2.10 from $1.14. Aritzia stock is rich, and so the risk is obvious, trading at 44 times earnings. Expectations are high. But when a retailer is still comping that strongly, another upbeat quarter wouldn’t be shocking at all.

OTEX

OpenText (TSX:OTEX) fits as a software company that keeps throwing off cash while trying to convince investors its slower-growth image is too harsh. OpenText stock provides information management software and cloud services, and over the last year, it has kept reshaping the business through asset sales, cloud growth, and new artificial intelligence (AI) and sovereign cloud partnerships. The biggest question around OpenText stock has been whether it can turn a steady business into a more exciting one.

Its recent figures show a business that still has some bite. In fiscal 2026 second-quarter results, OpenText stock reported quarterly revenue of US$1.33 billion, up 3% from the prior quarter, while non-GAAP diluted earnings per share (EPS) came in at US$1.13, ahead of the year-ago US$1.11. For the first half of fiscal 2026, total revenue reached US$2.62 billion, annual recurring revenue hit US$2.13 billion, and free cash flow nearly doubled to US$381 million.

What’s more, OpenText stock trades at just 13 times earnings with a 4.9% yield at writing. That’s much cheaper than many software names. The risk is that revenue growth still looks modest, but that also leaves room for an upside jolt if cloud and AI traction improve faster than expected.

DSG

Finally, Descartes (TSX:DSG) sells logistics and supply chain software, quietly building one of the more dependable growth stories on the TSX. Over the last year, it stayed active with acquisitions, including 3GTMS, Finale Inventory, PackageRoute, and OrderMine, while also posting record results and outlining a chief financial officer transition plan. That steady deal-making keeps widening the company’s platform and gives management more ways to squeeze out cross-selling and margin gains.

The earnings trend still looks strong. In fiscal 2026 fourth-quarter results, Descartes reported revenue of US$193 million, up from US$188 million in the prior quarter and US$168 million a year earlier. Net income reached US$45.6 million, up from US$37.4 million in the year-ago quarter. For the full fiscal year, net income rose to US$163.8 million from US$143.3 million.

DSG stock trades at about 36 times earnings at the time of writing. That valuation isn’t cheap, so investors are paying for quality. Still, if acquisition gains keep showing up in the numbers, DSG stock looks like the kind of stock that can keep delivering pleasant surprises.

Bottom line

Buying before an earnings surprise is never a sure thing, but these three names offer long-term strength. Aritzia stock has momentum, OpenText has low expectations and strong cash flow, and Descartes has a habit of executing well. That mix gives investors three different ways to play the same idea. Find a company with a live story, a believable catalyst, and enough room to impress. Right now, all three look like they could do just that.

The post 3 Canadian Stocks to Buy Before the Next Earnings Surprise appeared first on The Motley Fool Canada.

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Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Aritzia. The Motley Fool recommends Descartes Systems Group. The Motley Fool has a disclosure policy.