People invest in stocks for a variety of reasons, but ultimately, all investors have a similar end-goal in mind: financial independence. In order to meet that goal, the importance of beginning to invest early on can’t be understated, and the same could be said of selecting the right investments to add to your growing portfolio.
To help accomplish that goal, there are several appealing long-term investments that should be part of nearly every portfolio.
Start with the defensive duo
Market volatility over the course of the past few months has resulted in many investors rebalancing their portfolios with defensive investments that can also provide long-term gains. To help meet that goal, let’s take a moment to mention both Fortis (TSX: FTS)(NYSE: FTS) and Telus (TSX: T)(NYSE: TU).
With over $50 billion in assets and a diversified portfolio of operations scattered across Canada, the U.S., and parts of the Caribbean, Fortis is one of the top utilities on the continent. In total, Fortis has over three million customers, and a series of well-executed acquisitions over the years has allowed Fortis to record healthy growth while continuing to expand into new markets.
As a utility, Fortis benefits from a defensive business model made up of regulated contracts that result in a stable and recurring source of revenue for the company, which is then carried over to shareholders in the form of a quarterly dividend. The quarterly payout provides a handsome 3.99% yield, and investors can take solace in the fact that Fortis has provided investors with annual consecutive hikes to its dividend for over four decades.
Telus is another defensive holding, and Canada’s third-largest telecoms can be viewed by many as a diamond in the rough. As investors may deviate initially to Telus’ larger peers due to that company’s smaller footprint, but amazingly, Telus not only keeps up with its peers, but also excels in several markets.
By example, in the most recent quarter, Telus realized strong growth of 145,000 new subscribers from its wireless segment, while the internet segment also saw a gain of 36,000 subscribers.
Telus offers investors a very appetizing 4.82% yield, which has been subject to some incredible growth over the years. In fact, in the past eight years, Telus has reported an incredible 16 hikes to its dividend, all of which have averaged around 7%.
Add some energy into the mix
Canada’s energy sector provides also provides some incredible investment opportunities. Specifically, both Suncor Energy (TSX: SU)(NYSE: SU) and Enbridge (TSX: ENB)(NYSE: ENB) make compelling investment cases for long-term investors.
Enbridge has a massive pipeline network that covers North America, providing revenue for the company, not unlike a toll-booth network. Long-term prospects for the company are huge — not only from its highly-publicized acquisition of Spectra energy, but also from the numerous shovel-ready projects the company has that are valued in the billions.
Enbridge provides investors with an appetizing 6.43% yield.
Suncor, on the other hand, offers a much lower 3.81% yield, but still has plenty of growth potential. Suncor’s massive size has allowed the company to diversify into multiple areas while also becoming more efficient in its operations. Collectively, Suncor’s four refineries, renewable energy wind farms and 1,500 retail outlets across Canada have made Suncor the energy behemoth that every investor should seek out, and I’m not even mentioning Suncor’s oil sands holdings directly.
Finish off with a financial titan
No list of great investments would be complete without at least some mention of Canada’s Big Banks. Right now, Toronto-Dominion Bank (TSX: TD)(NYSE: TD) is the bank to buy for long-term growth.
In the years following the Great Recession, TD acquired a series of regional banks along the U.S. coast, and has over the years stitched them together and rebranded them into what is now known as “America’s most convenient bank,” with a network of TD branches that stretches from Maine to Florida.
That impressive U.S. network, which now surpasses the Canadian one in size, has been the source of some impressive growth recently, now accounting for a third of all revenue while providing a suitable hedge against the domestic market here at home.
In terms of a dividend, TD offers a solid 3.96% yield.
