Don't Miss AI's Third Wave
Stocks have outperformed almost all assets with their returns over time. This makes them a valuable investment for creating wealth in the long run. Therefore, investors should allocate some of their savings to stocks, especially to meet long-term financial goals like retirement. However, as stocks are inherently risky, investors should consider shares of fundamentally strong companies with the potential to deliver profitable growth for decades.
Against this backdrop, let’s delve into five Canadian stocks you can confidently invest $500 in right now.
goeasy
goeasy (TSX:GSY) is one of the top stocks to own right now. The company provides lending services to subprime lenders and has consistently delivered strong double-digit sales and earnings growth, which drive its share price higher. goeasy’s revenue has sported a compound annual growth rate (CAGR) of 17.7% since 2012. During the same period, its bottom line increased at a CAGR of 29.5%. Thanks to the stellar financials, goeasy stock appreciated 1,047% in the past decade.
Besides solid capital gains, goeasy’s shareholders have benefitted from its growing dividend payments. Its dividend has been growing incredibly fast. Looking ahead, the momentum in goeasy’s business will likely sustain driven by the large addressable market, diversified funding sources, geographic expansion, and steady credit performance.
Alimentation Couche-Tard
Alimentation Couche-Tard (TSX:ATD) is another solid long-term investment due to its durable revenue and earnings. This convenience store operator operates a low-risk business. Moreover, its top and bottom lines have grown at a CAGR of 7.3% and 18.8%, respectively, in the past decade. Thanks to its growing earnings base, Couche-Tard stock is up about 423% in 10 years. Moreover, Couche-Tard has increased its dividend at a CAGR of 26.6% during the same time.
Couche-Tard’s growing store base, expansion of private label offerings, and operational efficiencies will likely drive its top and bottom lines. Further, its strategic acquisitions will accelerate its growth rate, enabling the company to deliver solid earnings and higher dividends.
Dollarama
Like Couche-Tard, Dollarama (TSX:DOL) is another top stock to buy now. Its defensive business model, high growth rate, and focus on enhancing shareholders’ return through higher payouts make it a compelling investment for investors looking for stability, capital appreciation, and income. DOL stock has gained over 637% in the past decade, outperforming the broader market by a wide margin. Moreover, it has consistently increased its dividends during the same period.
Dollarama’s value pricing strategy, extensive store network, direct sourcing strategy, and initiatives to reduce merchandise costs bode well for long-term growth. Moreover, its growing earnings base would enable the company to consistently return cash to its shareholders through annual dividend growth.
Shopify
Shopify (TSX:SHOP) stock has lost substantial value from its peak. Despite the correction, SHOP stock has delivered an impressive 299% return in the last five years. This e-commerce platform provider is well-positioned to capitalize on the ongoing digital shift. Its ability to drive volumes and deliver solid revenue growth in all market conditions and growing share of e-commerce retail sales provide a solid foundation for future growth.
Further, Shopify’s ongoing transition toward an asset-light business model, innovative product launches, growing adoption of new products, and focus on delivering profitable growth supports my bull case. Also, its improving take rate and go-to-market strategy augur well for growth.
Canadian Natural Resources
Investors could consider Canadian Natural Resources (TSX:CNQ). This oil and gas company’s top-quality asset base and focus on rewarding its shareholders with higher dividend payments make it a compelling investment that generates solid capital gains and regular income. Canadian Natural Resources stock has risen about 269% in five years. Further, it has increased its dividend at a CAGR of 21% in the last 24 years.
The energy producer’s long-life and diversified asset base and high-value reserves could continue to drive its top line. Further, the company’s cost-cutting measures, low maintenance capital requirement, and robust balance sheet provide a solid underpinning for future growth.
