The 3 Best Canadian Stocks to Buy in November 2021

Canadian stocks are hitting all-time highs, but how do you invest going forward? Here are three stocks to buy for dividend, quality, and growth.

With Canadian stocks rising so much in 2021, it can be difficult to know how to invest going forward. Some days it seems like a plethora of events could derail stocks from their steady rise. It could be inflation, or it could be another COVID-19 resurgence.

The reality is that nobody knows when momentum reverses and stocks decline. Chances are good it is an event that nobody really foresees. The only thing investors can do is to invest in high-quality businesses, have a diversified portfolio, and own stocks for the long-term.

All of these factors help offset risk and create favourable conditions for wealth creation over time. If I was looking to build a diversified portfolio, here are three Canadian stocks I would consider owning now.

A top Canadian income stock

Every investor ought to have some exposure to dividend-producing stocks. Why? If the stock market were to decline, at least you would be certain of capturing dividend income returns. One Canadian dividend stock that looks very attractive today is Algonquin Power (TSX:AQN)(NYSE:AQN).

It has not exactly been a great year for this stock. It is down 15% since January. Yet, that presents an attractive opportunity to buy a high-quality utility at a nice discount. Today, this Canadian stock is yielding a 4.7% dividend. It trades with a price-to-earnings ratio of only 12.

The company just came out with pretty strong third quarter results. Likewise, it is purchasing a regulated utility that could be pretty accretive next year. For exposure to a predictable utility and renewable power growth, this is a great Canadian dividend stock to buy and hold.

A top quality stock

Another Canadian stock that gives investors broad diversification is Brookfield Asset Management (TSX:BAM.A)(NYSE:BAM). As one of the world’s largest asset managers, it has exposure to everything from real estate to credit to insurance. It is having an exceptional year. On Thursday, it reported its strongest quarter of fundraising on record. It raised $34 billion! It now manages more than $650 billion of assets.

In the quarter, BAM grew earnings per share year-over-year by 370% to $0.47 per share. Funds from operation per share grew 30% to $0.85 per share. While this stock is not necessarily cheap today, it still has tremendous opportunities to grow. Given its large scale and market leading position, it is the go-to asset manager for institutions across the world.

It has been growing its assets and distributable earnings annually by a compound rate of 25% and 32%, respectively. Given the factors above, chances are good it can keep growing forward at a similar strong rate.

A top Canadian tech stock

Descartes Systems (TSX:DSG)(NASDAQ:DSGX) might just be enjoying the perfect storm in 2021. The breakdown of global supply chains is causing havoc for manufacturers, distributors, and retailers. Descartes provides cloud-based software solutions that simplify and streamlines logistics processes across the value-chain.

The supply chain crisis has been a major tailwind for Descartes this year. Last quarter, it grew revenues by 25%. Adjusted EBITDA expanded by 35%. Since its software is crucial to its customers, it captures nearly 90% recurring revenues. Similarly it earns very high +40% adjusted EBITDA margins and strong free cash flows. It has no debt and a ton of cash to reinvest with.

This Canadian stock is up 45% this year and it is a pricey stock. However, you are paying for a high-quality business with a lot of upside in this environment. Descartes is certainly a top growth stock to have on your radar in 2021 and beyond.

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 Robin Brown owns shares of Algonquin Power & Utilities Corp., Brookfield Asset Management Inc. CL.A LV, and DESCARTES SYS. The Motley Fool recommends Brookfield Asset Management Inc. CL.A LV.

More on Stocks for Beginners

construction workers talk on the job site
Energy Stocks

Best Stock to Buy Right Now: Baytex vs Suncor?

Suncor and Baytex stocks both look like solid companies offering growth and dividends. But which is the better buy?

Read more »

profit rises over time
Top TSX Stocks

3 Reasons to Buy Enbridge Like There’s No Tomorrow

Have you considered buying Enbridge (TSX:ENB)? Here are 3 reasons to buy Enbridge today for lasting growth and income.

Read more »

An investor uses a tablet
Stocks for Beginners

If I Could Only Buy 2 Stocks in the Last Half of 2024, I’d Pick These

I’m looking to buy two stocks over the next month. Here’s a look at my picks and why you should…

Read more »

dividends grow over time
Stocks for Beginners

The Smartest Growth Stock to Buy With $2,000 Right Now

Do you have $2,000 to invest for the long term? These three TSX stocks have and will continue to deliver…

Read more »

The virtual button with the letters AI in a circle hovering above a keyboard, about to be clicked by a cursor.
Tech Stocks

Is OpenText Stock a Buy, Sell, or Hold for 2025?

OpenText stock has fallen in the last few years, but that could mean this top tech stock remains an undervalued…

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 »

grow money, wealth build
Dividend Stocks

3 Top High-Yield Stocks to Buy in November

If you want passive income, high yield dividend stocks are the clear choice. These are the best, and safest, out…

Read more »

Stocks for Beginners

Where will Loblaw Stock be in 5 Years?

Want a great food stock that can provide growth and income? Here's why Loblaw stock can offer that and more.

Read more »