5 Unmissable Blue-Chip Stocks for Your RRSP

Fairfax Financial Holdings Ltd. (TSX:FFH) and four other quality Canadian stocks are looking ripe for your retirement fund today.

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When it comes to investing in retirement, you want quality stocks that pay decent dividends and can go the distance. Below is a fistful of likely stocks, chosen from the cream of the blue-chip companies listed on the TSX index. There’s your usual mix of financials and telecoms, with consumables thrown in for good measure. Let’s start off with a favourite of domestic investors and see what some of the best Canadian stocks are looking like today.


TD Bank is looking like a very strong buy today, with a valuation close to equal its future cash flow value and market fundamentals close to acceptable levels: a P/E of 13.9 times earnings, PEG of twice growth, and P/B of 2.1 times book. TD Bank isn’t forecasting much growth ahead, with just 7% expected annual growth in earnings, though this is par for the course at the moment with financials.

A dividend yield of 3.41% reminds us of why this is regarded as such a high-quality stock. Acceptable levels of non-loan assets and low-risk liabilities go towards the same reading, though last year’s ROE was a little low at 14%.


A favorite of many Canadian investors, Rogers is discounted by 23% compared to its future cash flow value at the moment. Its figures look mixed on value: a so-so P/E of 19.1 times earnings, somewhat high PEG of twice growth, and off-putting P/B ratio of 4.7 times book.

An acceptable 9.7% expected annual growth in earnings is on the cards, while shareholders are rewarded with a dividend yield of 2.82%. Rogers’s return on equity last year was 25%, signifying a good use of shareholder funds by this telecom giant.

Restaurant Brands (TSX:QSR)(NYSE:QSR)

Overvalued by more than 50% of its future cash flow value, the Tim Hortons owner is still a stock worth owning, even if right now isn’t quite the time to buy. A P/E of 17.9 times earnings is fine and dandy, while a PEG of 1.1 times growth is reasonable. However, a P/B ratio of 7.1 times book feels too high to buy into.

A 16.6% expected annual growth in earnings spells good things ahead for this stock, while a dividend yield of 3.05% should keep shareholders cheerful; indeed, Restaurant Brands’s return on equity last year was a significant 34%. A high level of debt 286.4% of total net worth is something to be aware of if you’re thinking of holding long term.

Molson Coors (TSX:TPX.B)(NYSE:TAP)

Discounted by 26% compared to its future cash flow value, you’d think Molson Coors would be on a high after this summer’s landmark cannabis deal. Its P/E and PEG ratios are skewed at the moment, but a P/B ratio of 0.5 times book suggests investors are getting good value for money as far as assets are concerned. The rest of its figures may leave investors hungry, though, with a pint-sized dividend yield of 2.2% and a high level of debt at 240.6% of total net worth.

Fairfax (TSX:FFH)

Valued as per its future cash flow value, Fairfax is a financial holdings stock with a canny management style and an ambitious outlook. But how is it looking today on fundamentals?

A P/E of 7.4 times earnings and a P/B of 1.2 times book make for a realistically valued stock today. However, while it may be a stock for value investors, it is not one for growth investors, since there is no expected annual growth in earnings. A one-year return on equity of 13% and low debt are all well and good; throw in a dividend yield of 1.75%, and you have a well-rounded financial holdings stock to hold in your retirement fund.

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 Victoria Hetherington has no position in any of the stocks mentioned. The Motley Fool owns shares of Molson Coors Brewing and RESTAURANT BRANDS INTERNATIONAL INC. Fairfax is a recommendation of Stock Advisor Canada.

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