3 Stocks for Easy Passive Gains in 2022

Stocks like Fortis (TSX:FTS)(NYSE:FTS) offer safe returns regardless of economic conditions.

| More on:
money cash dividends

Image source: Getty Images

There’s plenty of opportunity on the stock market, but it’s rarely easy. The economy is volatile, earnings fluctuate, and even the most robust blue-chip stock isn’t immune to shocks. Growth investors have to face sudden drawdowns while value investors are in an endless race against inflation. 

That being said, there are some stocks that offer relatively easy and predictable returns. Here are the top three stocks you can buy and forget for the long term. 

Alimentation Couche-Tard

This little-known Canadian gem is, perhaps, one of the most steady compounders on the market. Couche-Tard operates convenience stores and gas stations across the world. This essential service is relatively recession-proof. In fact, sales across Couche-Tard’s outlets grew throughout every previous recession, including the dot-com bust and 2008 real estate crash. 

In fact, Couche-Tard’s stock performed so well that it has delivered a total return of 11,309% since early-1999. That’s a compounded annual growth rate of 22.8% over 23 years. It’s probably the most boring 100-bagger on the market.   

The stock is up 85% over the past two years, which means it created value despite the COVID-19 crisis that reduced travel and fuel consumption. In 2022, as travel rebounds, Couche-Tard could see significant upside. That’s what makes it an easy stock to hold for the long term. 

Fortis

Utility giant Fortis (TSX:FTS) is better-known than Couche-Tard, but it’s still undervalued. The stock trades at 22.9 times earnings per share. It also offers a 3.6% dividend yield that’s expected to steadily grow at 5% to 6% every year for the foreseeable future. 

Unlike Couche-Tard, Fortis doesn’t offer much capital appreciation. The stock is up just 838% since 1995. Not remotely exciting for growth investors. However, if you’re seeking passive income that keeps up with inflation, this could be a much better option. 

A buy-and-hold strategy combined with regular dividend reinvestments could be the winning formula for Fortis stock. The stock retains its value throughout recessions and can keep expanding payouts for several years ahead. That’s why it deserves a spot on your watch list. 

Northwest Healthcare REIT

We’ve already mentioned fuel and electricity, but the only thing more essential than both is health care. The health care real estate market is somewhat detached from the rest of the economy. Real estate investment firms like NorthWest Healthcare REIT (TSX:NWH.U) offer convenient exposure to this sector. 

NorthWest stock has nearly doubled over the past two years, but that’s only because of the rare drawdown it had in March 2020. Besides that, the stock has been remarkably stable for over a decade. 

The REIT currently trades at eight times earnings per share and offers a 5.6% dividend yield. That dividend is derived from rental agreements with an average lifespan of 14 years. Put simply, the management team has plenty of visibility on revenue to manage cash flow comfortably. Investors can rely on this stock for safe passive income regardless of the economic cycle. 

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 Vishesh Raisinghani owns Alimentation Couche-Tard Inc. The Motley Fool owns and recommends Alimentation Couche-Tard Inc. The Motley Fool recommends FORTIS INC and NORTHWEST HEALTHCARE PPTYS REIT UNITS.

More on Dividend Stocks

jar with coins and plant
Dividend Stocks

2 High-Yield Dividend Stocks You Can Buy and Hold for a Decade

These TSX stocks still offer attractive dividend yields.

Read more »

concept of real estate evaluation
Dividend Stocks

Invest $23,253 in This Stock for $110 in Monthly Passive Income

Dividend investors don’t need substantial capital to earn monthly passive income streams from an established dividend grower.

Read more »

Dividend Stocks

3 Mid-Cap Canadian Stocks That Offer Reliable Dividends

While blue-chip, large-cap stocks are the preferred choice for most conservative dividend investors, there are some solid picks in the…

Read more »

The letters AI glowing on a circuit board processor.
Dividend Stocks

Is OpenText Stock a Buy for Its 3.6% Dividend Yield?

OpenText stock has dropped 20% in the last year, yet now the company looks incredibly valuable, especially with a 3.6%…

Read more »

calculate and analyze stock
Dividend Stocks

How to Use Your TFSA to Earn $6,905.79 Per Year in Tax-Free Income

Put together a TFSA and this TSX stock, and you could create massive passive income from returns and dividends.

Read more »

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

Is RioCan REIT stock a buy for its 5.9% yield?

RioCan Real Estate Investment Trust (TSX:REI.UN) has had a rough go of it, but may be poised for a recovery.

Read more »

Dividend Stocks

3 CRA Red Flags for High TFSA Balances: Mistakes to Avoid

The CRA will not interfere as long as long as TFSA users avoid three costly mistakes.

Read more »

Canadian dollars are printed
Dividend Stocks

Transform Your TFSA Into a Cash-Generating Machine With Just $28,000

Canadians can turn their TFSAs into a cash-generating machine with money equivalent to four years’ contribution limits.

Read more »