3 Stocks That Are So Good, You Can’t Ignore Them

Every investor has different criteria for defining good stocks. But the value and return potential combination of stock can make it “good” by almost all standards.

| More on:
analyze data

Image source: Getty Images

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

What’s a good stock, according to you? Is it the stock that offers the most bang for its buck? Is it the most undervalued stock currently in the market or the most aggressive growth stock? Or you might have an entirely different classification of good in your mind. Regardless, there are three stocks that I perceive as good investments, which they either currently are or will be in the future.

A steel company

Precious metals have their allure, but base metals and their derivatives (like steel) can outshine them on occasion. One example would be Stelco Holdings (TSX:STLC), a proudly Canadian steel company that served the country’s needs for about a century before going bankrupt. Now, it has been revitalized as an American acquisition.

The company’s post-pandemic growth wave, which has still not turned the corner into a long overdue correction, has catapulted the price to enormous heights. At its peak, the stock grew over 1,200% from its rock-bottom price during the crash. What’s even more surprising is that it’s still quite undervalued, considering the price-to-earnings multiple of 3.3 and that it’s offering a 2.9% yield.

A generous dividend stock

High-yield stocks like MCAN Mortgage (TSX:MKP) are almost always a good buy, as long as you can be reasonably sure about the payout sustainability, which MCAN offers. This federally regulated mortgage investor might be considered inherently conservative, which equates to low risk. That makes its enormous 7.8% yield quite attractive, to say the least.

The sustainability potential of its dividends, if gauged by the payout ratio of 49.6%, is quite solid. The stock is also very undervalued right now, though not overly discounted. The company has grown its payouts for the last three years, following a major slash in 2018. And if that’s the level the company is trying to reach again, you may see a sizeable rise in your payouts starting next year.

A growth-oriented REIT

While REITs are usually picked for their dividends, Summit Industrial Income REIT (TSX:SMU.UN) should be considered for its capital-appreciation potential. It has a five-year CAGR of 36.2%, ranking it among some of the best growth stocks currently available on the TSX. While the 2021 peak is the stock’s highest point in the last nine years, it’s still a far cry from the level the stock used to trade on before 2012.  

And if this REIT is making a comeback to its glory days, you should consider buying it now. Even though the current yield of 2.4% is hardly tempting, the REIT’s growth potential coupled with its current undervaluation makes it an amazing deal right now. The recent growth can be chalked up to the REIT’s focus on light industrial properties, which are in high demand thanks to the e-commerce boom.

Foolish takeaway

The three companies, whether you put them in in your TFSA or RRSP, can help boost your portfolio’s return potential tremendously if they keep moving in the right direction. All three stocks are quite attractively valued as well.

Should you invest $1,000 in Lightspeed right now?

Before you buy stock in Lightspeed, 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 Lightspeed 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 $21,345.77!*

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 24 percentage points since 2013*.

See the Top Stocks * Returns as of 4/21/25

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 Adam Othman has no position in any of the stocks mentioned. The Motley Fool recommends SUMMIT INDUSTRIAL INCOME REIT.

Confidently Navigate Market Volatility: Claim Your Free Report!

Feeling uneasy about the ups and downs of the stock market lately? You’re not alone. At The Motley Fool Canada, we get it — and we’re here to help. We’ve crafted an essential guide designed to help you through these uncertain times: "5-Step Checklist: How to Prepare Your Portfolio for Volatility."

Don't miss out on this opportunity for peace of mind. Just click below to learn how to receive your complimentary report today!

Get Our Free Report Today

More on Dividend Stocks

Canada day banner background design of flag
Dividend Stocks

The Top Canadian Stocks to Buy Right Now With $5,000

These three Canadian stocks are top choices, especially for those wanting growth with a $5,000 investment.

Read more »

Retirees sip their morning coffee outside.
Dividend Stocks

Retirees: 2 Top Dividend Stocks for TFSA Passive Income

These stocks have increased their dividends annually for decades.

Read more »

top TSX stocks to buy
Dividend Stocks

Dip Buyers Could Win Big: The Top Canadian Stocks to Buy Now

These Canadian stocks are top options for investors looking for strength, income, and more in the future.

Read more »

Canadian dollars in a magnifying glass
Dividend Stocks

2 Cheap TSX Stocks to Watch in 2025

These top TSX stocks might be oversold.

Read more »

sale discount best price
Dividend Stocks

2 High-Yield TSX Stocks Now on Sale

These stocks have good track records of dividend growth and now offer high yields.

Read more »

woman analyze data
Dividend Stocks

A 9% Dividend Stock Paying Cash Every Single Month

This dividend stock remains an essential staple for investors, which is what makes it a top passive-income choice.

Read more »

Canadian Dollars bills
Dividend Stocks

This Dividend Stock Paying 6.4% Monthly Income Looks Undervalued

A Canadian REIT trading at a 15% discount to NAV just raised its payout—and its resilience shines in Q1 2025…

Read more »

dividends can compound over time
Dividend Stocks

I’d Invest $7,000 in These 2 High-Yield Dividend Stocks for Monthly Income

By investing $7,000 evenly across these two high yield dividend stocks, you could earn about $49.50 in tax-free income each…

Read more »