When it comes to the stock market, it can be difficult to see the big picture. If you’re someone who loves to watch their stocks day after day, it can be maddening to see them slump lower and lower. But such is the nature of the beast.
Instead, it might be better to start looking at the next decade when it comes to making your investments. Even the latest earnings results only paint part of a company’s picture, so why not see where the company is leading toward 10 or even 20 years from now?
If companies are able to provide you with a great answer, that means you’re likely looking at a great long-term investment.
Here are two companies I believe fall right into that category.
Enbridge
Enbridge Inc. (TSX:ENB)(NYSE:ENB) has been unnecessarily beaten down by the stock markets for the past year. The oil and gas industry’s performance has weighed heavily on this stock, and recent short-term problems have also brought the share price to well below fair value.
Yet the main reason the oil and gas industry is down is that there’s a glut in the industry that can only be alleviated by pipelines. That puts companies like Enbridge in an excellent position to take advantage should the companies be able to grow quickly, which Enbridge is doing in spades.
The company has $16 billion worth in growth projects that should be completed by 2021, and a further $3 billion in the works after that. When these projects are online, investors should expect a huge increase in cash flow for this already strong company.
Even without this growth, however, Enbridge remains a great investment with long-term contracts that will set up the company for decades. This also means the company’s amazing dividend yield of 6.33% as of writing will remain stable as well.
Amid all this growth and all this security, Enbridge should be a top choice for investors looking to buy and hold for the next decade.
Aurora Cannabis
A less obvious choice for investors is Aurora Cannabis Inc. (TSX:ACB)(NYSE:ACB). While the cannabis industry is a risky one at the moment, Aurora stands the best chance of becoming a global heavyweight at this point.
The company is already the largest producer of marijuana in the world, and is set to grow even further over the coming years. As of June 2020, Aurora will be able to produce 650,000 kilograms of marijuana per year, and is on the path to reaching 700,000 kilograms by the end of 2020.
Aurora has also narrowed in on only a few spaces of the cannabis industry, rather than looking to be all things to all consumers. The cannabidiol, medicinal, and recreational marijuana markets are the main areas in which Aurora is looking to grow.
However, the company’s share price has decreased dramatically after missing its latest earnings results, leading to downgrades in price targets by analysts across the board. But again, I encourage investors to look at the long term.
After changing its tune from the beginning of 2019, Aurora management now believes the company will become profitable by the end of 2020. That certainly would be music to investors who have seen shares become diluted further and further over the past two years.
Should the company receive a partner in that time, and reach its goal of cost per share per gram of $1, profitability could come even sooner. So stop watching the markets swing back and forth and consider this as a buy and hold stock that you won’t regret a decade from now.
