TFSA Wealth: 3 Super Stocks to Hold This Decade

TFSA investors should target super stocks like Empire Company Ltd. (TSX:EMP.A) as we enter the last week of January.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The S&P/TSX Composite Index fell 98 points on January 21. Canadian stocks have been on a tear since the sharp market correction in early 2020. This is an environment where the Tax-Free Savings Account (TFSA) can really be put to work. The federal government kept the TFSA annual contribution limit at $6,000 in 2021, making the cumulative contribution limit $75,500. That is a lot of room to work with. Today, I want to look at three super stocks that would be at home in a TFSA.

Why TFSA investors need to add this stock today

Goodfood Market (TSX:FOOD) is a Montreal-based online grocery company. Its services blew up during the COVID-19 pandemic as citizens looked for ways to avoid person-to-person contact. Having your groceries delivered is one more way you can accomplish that. Goodfood stock has climbed 276% year-over-year as of close on January 21. TFSA investors who held Goodfood over the past year have many reasons to celebrate.

The company reported its first quarter 2021 results on January 13. Revenues rose 62% year-over-year to $91.4 million. Moreover, its net loss improved by $2.5 million from the prior year. Active subscribers to Goodfood’s services increased 33% to 306,000. The end of the pandemic should not worry shareholders. Online grocery shopping was already a growing trend and will continue to attract adopters even as brick-and-mortar retailers resume regular operations.

This dividend stock has a promising future

In the summer of 2020, I’d suggested that investors look to stash shares of Maple Leaf Foods (TSX:MFI). It operates as a top consumer protein company in Canada. Maple Leaf stock has climbed 6.6% year-over-year as of close on January 21. However, shares have dropped 8.3% year to date. Maple Leaf is worth stashing in a TFSA for its long-term potential.

The company delivered sales growth of 6.2% in Q3 2020. The Meat Protein Group posted sales growth of 6.4% on the back of strong demand in its retail channel and more exports to the United States and Asia. Maple Leaf has attracted enthusiasm after it dove into the plant-based alternatives market. Its Plant Protein Group delivered sales growth of 9.3% in the third quarter. In January, it announced plans to expand its plant protein production capacity.

Maple Leaf also offers a quarterly dividend of $0.16 per share, representing a 2.4% yield.

One more defensive stock to stash in your TFSA

Empire Company (TSX:EMP.A) is the last stock I want to focus on for TFSA investors. Grocery retailers proved extremely resilient during the COVID-19 pandemic. This did not come as a huge surprise as they were designated as essential services. Moreover, restaurant closures likely had a positive impact on food purchases across the board. Empire has delivered robust growth in recent quarters. Its shares have climbed 18% year over year.

In the second quarter of fiscal 2021, Empire delivered same-store sales excluding fuel of 7.8%. E-commerce sales growth soared to 241%. Meanwhile, food retailing net earnings increased 27.3% year over year. Empire stock possesses a favourable price-to-earnings ratio of 16. This is a perfect defensive stock for a TFSA.

Should you invest $1,000 in Empire Company right now?

Before you buy stock in Empire Company, consider this:

The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Empire Company wasn’t one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $18,391.46!*

Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 35 percentage points since 2013*.

See the Top Stocks * Returns as of 1/7/25

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Ambrose O'Callaghan has no position in any of the stocks mentioned. The Motley Fool recommends Goodfood Market.

If You Thought Apple and Microsoft Were Big, You Need to Read This.

The steel industry produced the world's first $1 billion company in 1901, and it wasn't until 117 years later that technology giant Apple became the first-ever company to reach a $1 trillion valuation.

But what if I told you artificial intelligence (AI) is about to accelerate the pace of value creation? AI has the potential to produce several trillion-dollar companies in the future, and The Motley Fool is watching one very closely right now.

Don't fumble this potential wealth-building opportunity by navigating it alone. The Motley Fool has a proven track record of picking revolutionary growth stocks early, from Netflix to Amazon, so become a premium member today.

See the 'AI Supercycle' Stock

More on Investing

Data center servers IT workers
Tech Stocks

1 Canadian Stock Ready to Rise in 2025

This Canadian stock is ready to surge in 2025, and now is the time to buy.

Read more »

chip with the letters "AI" on it
Tech Stocks

2 Top Canadian AI Stocks to Buy in January

Here's why Kinaxis (TSX:KXS) and Docebo (TSX:DCBO) look like two top Canadian AI stocks worth buying to kick off 2025.

Read more »

calculate and analyze stock
Dividend Stocks

This Dividend Stock Is Set to Beat the TSX Again and Again

TerraVest Industries is a mid-cap gem with 58% revenue growth in Q3 2024, fueled by strategic acquisitions and organic growth…

Read more »

Oil industry worker works in oilfield
Energy Stocks

Canadian Investors: Should You Buy Canadian Natural Resources Stock While Under $50?

If there's one thing I love, it's a deal. And right now, CNQ stock looks like it could be a…

Read more »

Transparent umbrella under heavy rain against water drops splash background. Rainy weather concept.
Dividend Stocks

3 Canadian Defensive Stocks to Buy for Long-Term Stability

If you want long-term stability, then go on the defence with these three defensive stocks.

Read more »

Blocks conceptualizing Canada's Tax Free Savings Account
Dividend Stocks

TFSA: 4 Blue-Chip Stocks to Buy and Hold Forever

Buy and hold these blue-chip stocks in your TFSA portfolio for steady capital gains, stability, and regular dividend income.

Read more »

Canadian dollars are printed
Dividend Stocks

Got $25,000? Transform a TFSA Into a Cash-Gushing Machine

If you're looking to make a TFSA that just pumps out cash, this diverse portfolio is your prime option.

Read more »

Dividend Stocks

Got $1,000? 3 REITs to Buy and Hold Forever

If you have an extra $1,000, consider building a passive-income stream from these REITs.

Read more »