This company holds some of the most valuable assets in the world.
It owns railroads in Australia, toll roads in South America, and shipping ports in Europe. I can think of only a few other companies with a collection of properties quite like this.
And thanks to its monopoly status, this stock pays one of the biggest, most consistent dividends around. My advice: Buy it, hold it, and let this stock make you rich.
Let me explain…
As regular readers know, I’m a big advocate of a set of companies I like to call my “Forever Stocks”. Put simply, these companies are so reliable, you could literally hold them for the rest of your life. Because of their durable businesses, these elite stocks can be counted on to crank out big, steady dividends.
What’s amazing is that these companies have remained almost unchanged for decades. Tech firms must invent another gadget every few years. But these businesses have made virtually the same products for generations. You probably use them every day.
Of course, such stocks are tough to find. That’s why I wanted to share one today. This company is Canada’s largest asset manager… and one of the top dividend stocks in the country: Brookfield Asset Management Inc (TSX: BAM.A)(NYSE: BAM).
Its status as a “Forever Stock” comes down to three points.
First, Brookfield’s business is vital to your daily life. As mentioned above, it owns a diverse set of assets — i.e., railways, ports, utilities, roads, and pipelines — without which our modern society would grind to a halt. That means Brookfield sees steady demand for its services, just like a utility.
Second, these assets are hard to replicate. It just doesn’t make business sense to have two pipelines or railroads serving the same market. Without rivals to drive down margins, Brookfield is almost guaranteed to earn a decent return.
Finally, the number of investment opportunities is surging. To raise cash, governments around the world are increasingly selling public assets to private enterprises. That means Brookfield shareholders can count on steady growth in the coming decades.
Of course, the real test of a Forever Stock is how it fares during times of uncertainty. That said, Brookfield managed to hike its payout even during the height of the financial crisis. Since 2006, it has never skipped a dividend payment to investors.
There are no sure things. However, Brookfield is a durable business that will likely reward shareholders for years to come. That’s why it deserves a permanent place in your portfolio.
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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 Robert Baillieul has no position in any stocks mentioned.