The 3 Best TSX Large-Cap Stocks to Buy Now

These fundamentally strong, large companies will likely add stability and generate solid returns over time. 

It will be a smart move to allocate a portion of your portfolio to large-cap stocks amid the heightened volatility in the stock market. I believe the fundamentally strong, large companies will likely add stability and generate solid returns over time. 

Let’s delve into three such large-cap stocks that could continue to outperform the benchmark index over the next decade. 

Royal Bank of Canada

With the ongoing economic expansion and improving operating environment, Royal Bank of Canada (TSX:RY)(NYSE:RY) will likely deliver strong earnings, which, in turn, will give a significant boost to its stock price. Its large scale, diversified business model, and strong balance sheet position Royal Bank of Canada well to capitalize on improving macro environment and deliver industry-leading volume growth. 

Furthermore, its strong suite of products, cross-selling opportunities, and operational efficiency augur well for future growth. I expect improving volumes, its strong credit quality, and expense management will drive its earnings at a decent pace. 

Thanks to its high-quality earnings, Royal Bank of Canada has consistently boosted its shareholders’ returns through higher dividend payments. Its dividends have a CAGR of 8% over the last decade. Moreover, it offers a solid yield of 3.6%. 

Shopify 

Despite the recent selling, Shopify (TSX:SHOP)(NYSE:SHOP) stock is still up over 25% this year. This tech giant has consistently delivered stellar returns and outpaced the benchmark index. Looking ahead, I am upbeat over its prospects and expect Shopify to deliver solid returns regardless of the reopening of the physical retail locations. 

My bullish view stems from the ongoing shift in selling models towards omnichannel platforms. With its strong product base and continued investment in growth initiatives, Shopify is well-positioned to expand its market share and capitalize on the strong demand. 

Shopify’s strengthening of its fulfillment network, increased penetration of its payments solutions, high-value product launches, the addition of multiple marketing and sales channels, and geographic expansion could continue to acquire newer merchants on its platform and deliver strong growth. Furthermore, its strong balance sheet and operating leverage bode well for future growth.

Fortis

Fortis (TSX:FTS)(NYSE:FTS) is one of the safest bets amid heightened volatility in the stock market. Its diversified and regulated business makes it immune to the wild market swings. Meanwhile, its predictable cash flows support dividend growth. 

It’s worth noting that Fortis owns 10 regulated utility businesses that deliver solid cash flows. Meanwhile, consistent rate base growth drives its profitability. Fortis projects its rate base to reach $41.6 billion by 2026, which will increase its high-quality earnings base. Meanwhile, acquisitions and its growing renewable footprint will likely accelerate its growth. 

Notably, this utility company has a long history of consistently raising its dividend. To be precise, Fortis has raised it in the last 48 years in a row. Thanks to the strong visibility over its cash flows and solid earnings base, Fortis projects 6% average annual dividend growth through 2025. Overall, its low-risk business, solid cash flows, and consistent dividend hikes make it a top long-term bet. 

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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool owns and recommends Shopify. The Motley Fool recommends FORTIS INC.

More on Investing

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

Is Fortis Stock a Buy for its 4% Dividend Yield?

Here's why Fortis (TSX:FTS) certainly looks like a long-term buy for its strong and growing dividend yield over time.

Read more »

ways to boost income
Investing

2 Financial Stocks That Canadian Investors Should Grab in November

Great-West Lifeco (TSX:GWO) and another financial stock have huge yields and upside potential in 2025.

Read more »

Piggy bank with word TFSA for tax-free savings accounts.
Investing

Here’s the Average TFSA Balance at Age 64 in Canada

This highly diversified Vanguard retirement income ETF is perfect for passive income.

Read more »

money goes up and down in balance
Bank Stocks

Is Toronto-Dominion Bank Stock a Good Buy?

TD stock is underperforming its peers in 2024. Will 2025 be different?

Read more »

tsx today
Stock Market

TSX Today: What to Watch for in Stocks on Tuesday, November 26

U.S. consumer confidence and new home sales data will remain on TSX investors’ radar today.

Read more »

Dividend Stocks

Top Canadian Stocks to Buy Right Now With $1,000

Investing in stocks is not about timing but consistency. If you have $1,000 to invest, these stocks offer an attractive…

Read more »

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

1 Way to Use a TFSA to Earn $250 Monthly Income

Here's one way long-term investors can utilize a Tax-Free Savings Account to generate $250 per month in passive income in…

Read more »

cloud computing
Dividend Stocks

Is Manulife Stock a Buy for its 3.5% Dividend Yield?

Manulife stock has been a long-time dividend winner, but the average has come down over the last few years. So…

Read more »