Back in 2017, I’d discussed stocks that were suitable for a portfolio that was built for the future economy. In that article, I’d focused on equities in automation, building and maintaining internet infrastructure, and renewable energies. Today, we will focus on three more equities that fit the bill.
Investing in stocks that are well positioned for long-term growth is a fantastic strategy for TFSA investors. Those betting on a future-oriented stock can rack up tax-free gains in the long term. What qualifies as a future-oriented stock? Let’s dive in.
Innergex Renewable Energy (TSX:INE)
Innergex Renewable stock was up 14% in 2019 as of close on January 22. Back in November, I’d recommended Innergex for TFSA investors. Shares have climbed 16% over a three-month span.
In October, research by Frost & Sullivan, a Texas-based business consulting firm, estimated that renewable power-generation capacity would grow by 13.3% in 2018. China’s decision to slow the rate of growth in its solar sector resulted in a lower growth rate than 2017 this year, but investment still rose above $220 billion worldwide. Solar represents the bulk of new capacity, with wind coming in second.
Innergex owns and operates hydroelectric facilities, wind farms, and solar photovoltaic farms. In Q3 2018, the company saw revenues rise 30% year over year to $140.8 million on the back of recent acquisitions and significant growth in power generation. To top it off, the stock offers a quarterly dividend of $0.17 per share, which represents a nice 4.8% yield.
Aurora Cannabis (TSX:ACB)(NYSE:ACB)
The legalization of recreational cannabis in Canada generated enormous buzz over the last few years. Cannabis stocks experienced soaring valuations. Aurora stock more than tripled from November 2017 to January 2018, and again reached all-time highs in the days leading up to legalization.
Cannabis stocks were bit by a bumpy roll-out but have stabilized and gathered momentum in early 2019. Aurora expects to hit production capacity of 150,000 kilograms per annum by the third quarter of fiscal 2019. A report from Grand View Research projected that the global legal cannabis market would reach $146.4 billion by 2025. This would represent compound annual growth of 34.6%.
Aurora is a heavyweight producer in Canada and has pushed to establish international operations that will give it an edge as other nations around the globe move to legalize recreational use.
Global Water Resources (TSX:GWR)(NASDAQ:GWR)
Global Water Resources is a water resource management company that operates principally in Phoenix, Arizona. Shares were down 8.3% as of close on January 22, making it one of the few potential discount targets in early 2019.
Population growth and the threat of climate change has put more pressure on water resources companies in recent years. Water is a solid long-term play. The inevitability and severity of crises involving water supply have at times been overstated, but management of private water supply will draw increased attention in the future due to the pressure mentioned above.
Global Water Resources is not a flashy stock, but it has posted steady growth since its IPO following a merger in 2016. The stock currently offers a monthly dividend of $0.023861, which represents a 2.9% yield as of close on January 22.
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Fool contributor Ambrose O'Callaghan owns shares of Aurora Cannabis.