MENU

Fool Canada’s first 1,000%+ winner?

Our Chief Investment Advisor, Iain Butler, and a team of The Motley Fool’s most talented investors from across the globe recently embarked on an unprecedented mission:

To identify the 20 Canadian small-cap companies they believe have the best shot at earning investors like you gains of 1,000%+ over the coming years.

For the next few days only, you can get the names and full details on these 20 potential “10-baggers” when you join Iain and his team in a first-of-its-kind project they have dubbed Discovery Canada 2017.

Get Rich Slowly With Enbridge Inc. and Toronto-Dominion Bank

Perhaps it’s the grumpy old man in me talking, but it seems like people are less patient than ever.

People weave in and out of traffic, okay with putting themselves in danger in exchange for knocking a few minutes off their commute. Buying stuff off the Internet is quick, cheap, and easy, yet we still complain when an item takes longer than a couple of days to get into our hands. And when a flight gets delayed by even a few minutes, you can cut the tension with a knife.

Investors are hardly immune to impatience. Thousands have fallen for all sorts of get-rich-quick schemes. When the latest hot stock gets touted, a stampede of investors flood in, hoping to catch the wave. Or we do silly things like try to trade nearly bankrupt companies, telling ourselves we’ll sell when it goes up 10%.

We all know how that ends.

There’s a better way. If investors want to become rich, all they need to do is buy and hold some of Canada’s finest companies for a very long time. As the years turn into decades, they’ll find that today’s giants find a way to get even bigger, generating solid investment returns in the process.

Patience is the key. As long as investors don’t sell prematurely, they can enjoy terrific gains over a lifetime of investing.

Here are two terrific buy-and-hold forever stocks to get investors started.

Enbridge

Enbridge Inc. (TSX:ENB)(NYSE:ENB) is a energy powerhouse with more than 27,000 km of liquids pipelines, 24,000 km of natural gas pipelines, 1,776 MW in electricity generation capability, and 2.1 million gas distribution customers. Altogether, this translates into more than $80 billion in hard-to-replace assets.

Enbridge has done a nice job avoiding the calamities that have plagued the rest of the energy market. Approximately 97% of its earnings are from fixed-price contracts, meaning it takes very little exposure to underlying commodity prices.

The company still has plenty of growth potential with some $10 billion in projects slated to come online between now and 2019. This doesn’t even include the Northern Gateway project in British Columbia, a 1,177 km pipeline that’s estimated to cost $8 billion.

Enbridge has also recently gotten serious about hiking its dividend. In 2011 the company paid an annual dividend of $0.98 per share. That’s more than doubled in the five years since, and management is projecting a $2.12 per share dividend. Additionally, the company has issued guidance that predicts dividend growth of between 10% and 14% annually through 2019.

This all translates into outstanding share performance over time. In the last two decades, including reinvested dividends, Enbridge shares have returned an astounding 19.5% per year. This means a $10,000 investment made in June 1996, would be worth $352,650 today.

Toronto-Dominion

When investors are asked which of Canada’s Big Five banks is the finest, many will give the same answer: Toronto-Dominion Bank (TSX:TD)(NYSE:TD).

There are many reasons investors feel this way. One of the most important is the bank’s U.S. exposure, which includes 1,265 branches, $90 billion in assets under management, and $2.7 billion in earnings during its latest quarter. Approximately 30% of total earnings come from the United States.

Investors also like the bank’s dominance in Canada. It ranks number one or number two in just about every important retail banking category, including an overall 21% market share. TD offers it all to customers, even including property, casualty, life, and health insurance.

Like Enbridge, TD has a terrific dividend with history of steadily increasing the payout. Five years ago, TD paid a quarterly dividend of $0.33 per share. These days that dividend has gone up nearly 70%, currently sitting at $0.55 per share. That’s good enough for a 3.9% yield today.

TD hasn’t performed quite as well as Enbridge over the last 20 years, but shares have still done remarkably well. Including reinvested dividends, TD shares have increased 15.9% annually since June 1996. A $10,000 investment made back then would be worth $192,557 today.

I can’t guarantee TD and Enbridge will perform as well in the next 20 years as they did in the last 20. What I do know is that each has a dominant position in a market that still has plenty of growth potential. That’s a good thing for long-term investors.

More great get-rich-slowly stocks!

Enbridge and TD are both great companies, but you'll need more than just those two to make a truly diverse portfolio.

For a look at five top Canadian companies that won't let you down, click here now to download our special FREE report, "Stop Following Bad Advice. Buy These 5 Companies Instead!".

Fool contributor Nelson Smith has no position in any stocks mentioned.

NEW! This Stock Could Be Like Buying Amazon In 1997

For only the 5th time in over 14 years, Motley Fool co-founder David Gardner just issued a Buy Recommendation on this recent Canadian IPO.

Stock Advisor Canada’s Chief Investment Adviser, Iain Butler, also recommended this company back in March – and it’s already up a whopping 57%!

Enter your email address below to find out how you can claim your copy of this brand new report, “Breakthrough IPO Receives Rare Endorsement.”

I consent to receiving information from The Motley Fool via email, direct mail, and occasional special offer phone calls. I understand I can unsubscribe from these updates at any time. Please read the Privacy Statement and Terms of Service for more information.