I’d love to sit here and say I’m the kind of investor that doesn’t check on stocks day after day to see performance, namely, that I listen to advice from analysts and investors who claim that it’s best to buy stocks with great long-term potential and then forget about them.
That’s just not realistic for someone like me, and likely many of you.
So when I look to see how my investments have been doing since the beginning of the year, I can’t say I’m ecstatic with the results. Let me clarify a bit.
These aren’t the only stocks I have, of course, but I was definitely drawn to the performance of Canopy Growth Corp. (TSX:WEED)(NYSE:CGC), Enbridge Inc. (TSX:ENB)(NYSE:ENB), and Pembina Pipeline Corp. (TSX:PPL)(NYSE:PBA). Each of these stocks has had pretty poor performance so far this year.
But am I selling? Heck no. Here’s why.
Canopy Growth certainly isn’t alone in its poor performance this year. And it’s not like it’s been awful; it’s just one of my worst performers. The stock fell to the mid-thirties around the new year, climbing back up to near its 52-week high in less than a month! But since then, the stock has faltered, falling after disappointing earnings results.
So why didn’t I sell back at the $70 mark on either occasion? Well, I believe hat Canopy Growth is setting up for long-term growth. The company claims to have over five million square feet of production space, creating a capacity that completely overshadows any other competitor. It also has a firm foothold on the United States if, and when, legalization occurs, specifically through the recent acquisition of Acreage Holdings and its partnership with Constellation Brands.
Beyond America, the company has access to 15 countries, meaning that it isn’t dependent on American legalization, nor on a relatively small Canadian market. The global opportunity out there is huge, and Canopy stands to gain the most from it. I’m willing to wait and see that come to fruition.
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Another stock having a hard year is Enbridge. The stock traded around $42 per share at the new year, came up to $51, and is now back down to around $47.50 as of writing. That slump came after reports that the pipeline company had received another setback in its Line 3 project.
Since then, the project has been given the green light yet again, but the stock still is far below its fair value. It shouldn’t be a surprise that this comes from the oil and gas industry’s overall poor performance lately, coupled with these pipeline problems.
But again, I’m holding out for this titan pipeline producer for a few reasons. In fact, I recently bought more of the stock, as Enbridge has a number of long-term contracts to bring in steady cash even during tough times such as these.
Instead of buckling down during what should be a hard time, the company has enough cash to invest $16 billion in growth projects over the next few years. Once online, those projects should set my stocks soaring. Oh, and of course, there’s that sweet 6.27% dividend yield that continues to make me quite content.
Much like Enbridge, Pembina has also suffered from the oil and gas setback. The stock traded at $41 in the new year, came up to $50, and has since come down a hair to around $49 per share as of writing.
The stock was on a healthy momentum since 2015 until the slump in December, but that provided people like myself with the opportunity to buy up this long-term stock. Pembina remains completely undervalued given its future potential as it continues to expand.
By 2022, analysts believe the company should reach earnings of $1.6 billion, a 33% increase from its current earnings of $1.2 billion. And again, there’s a 5% dividend yield keeping me mighty happy.
I could be down in the dumps over my investment prospects, but I still remain a long-term investor for all three of these stocks. In fact, as I mentioned, I even bought more. That’s because I did thorough research on my own and through Motley Fool and am confident in future performance. I might just check back in once these three stocks turn from dud status to my golden ticket.
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 Amy Legate-Wolfe owns shares of Canopy Growth, ENBRIDGE INC, and PEMBINA PIPELINE CORPORATION. The Motley Fool owns shares of Enbridge. Enbridge is a recommendation of Stock Advisor Canada. Pembina is a recommendation of Dividend Investor Canada.