Hi there, Fools. I’m back to highlight three attractive large-cap stocks on the TSX Index. As a quick reminder, I do this because large established companies
- can help stabilize your portfolio during times of market distress (like we saw at the end of 2018); and
- usually pay healthy dividends year in and year out.
Large-cap stocks won’t make you a millionaire next week. But as long as you’re patient, holding on to these “forever assets” gives you the best probability of building massive wealth over time.
Let’s get to it.
Leading things off is Canadian Natural Resources (TSX:CNQ)(NYSE:CNQ), which has a market cap of $43 billion. Shares of the oil and gas giant are down 23% over the past year versus a loss of 25% for the S&P/TSX Capped Energy Index.
Management is doing what it can to deal with the ongoing pipeline challenges. The company is now planning a full-year 2019 capex budget of $3.7 billion, which is roughly $1 billion lower than in 2018.
“Safe, reliable, effective and efficient operations will continue to be a focus for the Company,” said President Tim McKay, “as cost control and reliability across all assets will maximize value for shareholders in 2019.”
With a juicy dividend yield of 3.7%, betting on that bullishness makes a tonne of sense.
Next up, we have Restaurant Brands (TSX:QSR)(NYSE:QSR), which sports a market cap of $35 billion. Shares of the fast-food restaurant operator are down 6% over the past year versus a loss of 14% for the S&P/TSX Capped Consumer Discretionary Index.
I’d look at the recent price pullback as a solid buying opportunity. In the most recent quarter, system-wide sales rose for all three of its brands: Tim Hortons grew 2.8%, Burger King increased 7.8%, and Popeyes improved 7.9%. Moreover, same-store sales were positive at all three chains.
“We remain confident that our focus on guest satisfaction and franchisee profitability will drive growth at all three of our brands for many years to come,” said CEO Daniel Schwartz.
Currently, the stock offers an attractive yield of 3.2%.
With a market cap of $40 billion, Alimentation Couche-Tard (TSX:ATD.B) rounds out our list. Shares of the convenient store king are up 24% over the past six months versus a gain of 5.5% for the S&P/TSX Capped Consumer Staples Index.
Alimentation’s business momentum should carry into 2019. In the most recent quarter, revenue climbed 21% to $14.7 billion. More importantly, same-store merchandise revenue grew 5.1% in Canada, 4.3% in the U.S., and 4.6% in Europe.
“We had strong performance this quarter across the entire network,” said President and CEO Brian Hannasch. “Overall, we feel good about the momentum we are seeing in our stores as we continue our network-wide push of promotional and marketing programs.”
When you couple that rock-solid performance with the stock’s ultra-low beta, Alimentation’s 2019 downside seems limited.
The bottom line
There you have it, Fools: three large-cap “forever assets” worth looking into.
They aren’t formal recommendations, of course. Instead, they’re simply ideas worth further research. Even the safest large-cap stocks can sink sharply from time to time, so lots of due diligence is still required.
And we won’t be opening up again for the foreseeable future.
Tune in to our LIVE “Project X” event now for full details on the unique investing “X Factor” that Motley Fool co-founder and CEO Tom Gardner himself discovered has outpaced the S&P 500 in our U.S. business by a factor of greater than 4-to-1.
Plus, why our Motley Fool Canada team is now staking $250,000 of our own capital on this incredible “X Factor.” (Event already in progress, and available TODAY only.)
Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of RESTAURANT BRANDS INTERNATIONAL INC. Couche-Tard is a recommendation of Stock Advisor Canada.