3 Companies That Aren’t Missing the All-Time High Party

These Canadian companies are flourishing even though parts of our market aren’t.

Iain Butler ❯

Chief Investment Advisor, Motley Fool Canada Fool since November 2012 Iain Butler, CFA, is Lead Advisor on Discovery Canada 2017. He is also the Chief Investment Advisor for Motley Fool Canada and is the lead advisor on its flagship Stock Advisor Canada product. Before joining the Fool, Iain was a “buy-side” analyst and through this experience is well-versed in the idiosyncratic ways of the Canadian market. His investing interests are centred on scouring the market for interesting businesses that trade at reasonable prices and offer an appealing risk/reward relationship. Since joining the Fool in 2012, Iain dedicates each day to spreading Foolishness throughout this great country!

Published April 3, 2013 11:13 am EDT

If you pay even the slightest bit of attention to the financial press, you know that both the Dow Jones Industrial Index and the S&P 500 have recently eclipsed their all-time high water marks. Thanks in large part to resource (energy/materials) stocks, the Canadian market has been left in the dust kicked up by its partying U.S. peers. The S&P/TSX needs to appreciate by about 19% to join in on the fun.

Just because the overall Canadian market has languished doesn’t mean there aren’t stocks that have recently achieved lifetime highs. The three big caps that currently sit within spitting distance of this headline friendly level are Enbridge (TSX:ENB,NYSE:ENB), TransCanada Corp. (TSX:TRP,NYSE:TRP), and Rogers Communications (TSX:RCI.B,NYSE:RCI).

No flash in the pan

Long-term investors in all three names are very likely a happy, and wealthy lot. The results tabled below speak volumes for the merits of buy and hold, dividend focused investing.

Company Name	IPO-Present	Price Return	Dividend Adj. Return
Enbridge	1/2/1976–4/1/2013	+3,107.4%	+32,134.9%
Rogers	11/30/1979–4/1/2013	+10,923.4%	+14,671.3%
TransCanada	6/3/1985–4/1/2013	+71.4%	+518.8%

Source: Capital IQ

If one had the foresight to invest $100 in each of these IPOs and simply held on, collecting dividends along the way, they would currently be sitting on a $47,000 stash. Not too shabby for three boring, old economy stocks!

Foolish Takeaway

Not only do the returns achieved by these three Canadian stalwarts help reinforce the power of long-term investing, they also demonstrate how profitable a competitive advantage can be for investors. All three are owners of assets that essentially will not be replicated. Rogers with its cable, and to a lesser extent wireless networks, and Enbridge and TRP with their pipeline assets. Companies that own irreplaceable assets are rare. When you find one, buy and hold on for the long ride to riches they can provide.

The S&P/TSX Composite Index is loaded with resource and financial stocks. Because of this, investors that rely on Canadian Index funds or ETFs severely lack diversification in their portfolio, opening them to undue risks. “Buy These 5 Companies Instead of Following a Flawed Piece of Advice” is our special FREE report that outlines an easy to implement strategy and 5 Canadian stocks that reduce the risks involved with passively investing in the Canadian market. Click here now to receive the report – FREE!

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Fool contributor Iain Butler does not own shares in any of the company’s mentioned. The Motley Fool has no positions in the stocks mentioned above.