2 Top Stocks to Buy With $1,000 in June 2021

With the TSX’s continued ascent, invest your $1,000 in two top dividend stocks rather than keeping it idle. Rogers Sugar stock and Extendicare stock pay attractive dividends.

| More on:

The TSX opened above the 20,000 level for the first time on June 2, 2021. after closing at an all-time high (19,976.20) the day before. Canada’s primary stock exchange continues its hot streak from May to push its year-to-date gain to 14.89%.

Market observers agree that the TSX has more than recovered from its COVID low. None of the 11 primary sectors are in negative territory. As oil prices increase due to rising demand, the energy sector (+52.9% year to date) keeps advancing.

Barry Schwartz, Baskin Wealth’s chief investment officer, said the rally makes sense. Several companies have commodities that are very much in demand right now. Also, more businesses should recover when the economy reopens, and things are back to normal.

The TSX on the path to an explosive year. Even Canadians with only $1,000 to invest can create passive income. You can split the money equally to buy high-yield dividend stocks like Rogers Sugar (TSX:RSI) and Extendicare (TSX:EXE).

Higher volumes

Rogers Sugar expects higher volumes for its sugar and maple business segments for the rest of fiscal 2021. In the first six months (ended April 30, 2021), revenue and net earnings increased 7.7% and 45% versus the same period in fiscal 2020. Sugar volume was 10,584 metric tons higher, while maple syrup increased 13.3% to 29,106 (thousand pounds).

John Holliday, president and CEO of Rogers and Lantic, said the company was able to provide consistent, reliable supply and meet customers’ needs due to added operational flexibility. He’s confident sugar sales would remain high and deliver far better results than fiscal 2020. Rogers’s production improvements in its maple business should lead to stronger profitability.

Rogers Sugar expects to end fiscal 2021 with higher sugar volumes (industrial and liquid), or 15,000 metric tons more than the previous year. Export volumes should likewise increase by 5,000 metric tons due to new liquid customers and the Canada-United States-Mexico Agreement (CUSMA) special quotas. If you were to purchase the consumer staple stock today, the share price is $5.91. The $611.9 million sugar producer pays a hefty 6.09% dividend.

Turning point

The COVID-19 pandemic caused panic in the long-term-care (LTC), retirement living, and home healthcare industry because of the coronavirus outbreak. However, Extendicare weathered the storm in 2020. According to its president and CEO Dr. Michael Guerriere, Q1 2021 (quarter ended March 31, 2021) marks the turning point.

Infection cases dropped dramatically in Extendicare’s homes due to its successful vaccination program for residents and staff.  As a result, revenue and net operating income increased 18.6% and 32.6% compared to Q1 2020. The numbers would have been higher if the average occupancy rate didn’t drop from 97% to 82.9% due to reduced admissions.

The $731.72 million provider of LTC, retirement living, and home healthcare services received funding support from the provincial government of Alberta and Ontario. It offset the $11.9 million in temporary pandemic pay increases for eligible front-line staff in Q1 2021.

Thus far, in 2021, the healthcare stock (+27.01%) has outperformed the TSX and trades at $8.20 per share. Extendicare’s dividend offer is an attractive 5.85% dividend.

From idle to productive cash

Since the average yield of the two dividend stocks is 5.97%, a $1,000 investment can generate $59.70 in extra income which idle cash can’t produce. Hold them in a Tax-Free Savings Account, and your earning is tax-free.

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 Christopher Liew has no position in any of the stocks mentioned. 

More on Dividend Stocks

TFSA (Tax-Free Savings Account) on wooden blocks and Canadian one hundred dollar bills.
Dividend Stocks

Where to Invest Your $7,000 TFSA Contribution

The TFSA is attractive for investors who want to generate tax-free passive income.

Read more »

The TFSA is a powerful savings vehicle for Canadians who are saving for retirement.
Dividend Stocks

TFSA Investors: 3 Dividend Stocks Worth Holding Forever

These TSX stocks have the potential to grow their dividends over the next decade, making them top investments for TFSA…

Read more »

Tractor spraying a field of wheat
Dividend Stocks

Is Nutrien Stock a Buy for its Dividend Yield?

Nutrien is down more than 50% form the 2022 highs. Is NTR stock now oversold?

Read more »

golden sunset in crude oil refinery with pipeline system
Dividend Stocks

Best Stock to Buy Right Now: Enbridge vs TC Energy?

Enbridge and TC Energy rebounded nicely over the past year. Are more gains on the way?

Read more »

Electricity transmission towers with orange glowing wires against night sky
Dividend Stocks

2 Utility Stocks That Are Smart Buys for Canadians in November

Are you looking for some of the smart buys to consider in November? These utility stocks offer growth and a…

Read more »

View of high rise corporate buildings in the financial district of Toronto, Canada
Dividend Stocks

Is Power Corporation of Canada Stock a Buy for its 5% Dividend Yield?

Is Power Corporation of Canada (TSX:POW) stock's 5% dividend yield worth it? Discover why this resilient stock could be a…

Read more »

hand stacks coins
Dividend Stocks

Here Are My Top 3 Dividend Stocks to Buy Now

These three dividend stocks are ideal for strengthening your portfolio and earning a stable passive income.

Read more »

man touches brain to show a good idea
Dividend Stocks

3 No-Brainer REIT Stocks to Buy Right Now for Less Than $200

REITs have long been touted as some of the best dividend stocks out there if you want recurring, strong income.…

Read more »