Establishing a long-term portfolio of investments that can provide a sizable nest egg for retirement is a dream of every investor. Unfortunately, for some investors, the process of selecting which stocks to buy is often made out to be more complicated than it needs to be.
The investments outlined below should eliminate any complication while also providing a solid path toward both growth and income-earning potential for the future.
Buy today, see green tomorrow
Toronto-Dominion Bank (TSX: TD)(NYSE: TD) is not only one of the biggest banks in Canada, but it’s also one of the biggest in the U.S. market. That growth in the U.S. is thanks to a series of well executed acquisitions that the bank has made over the past decade, resulting in a branch network that stretches from Maine to Florida.
TD’s sizeable U.S. presence helps offset any perceived over-reliance on the Canadian market, while also benefiting from the lucrative opportunities available in the U.S. market.
By way of example in the most recent quarter, TD’s U.S. retail segment reported adjusted net income of $1,287 million, reflecting a handsome gain of 13% over the same period last year.
That’s not to say the Canadian retail didn’t perform well, however — the segment posted adjusted net income of $1,916 million, a 3% uptick over the prior period.
Turning to dividends, TD offers an attractive quarterly payout that works out to a respectable yield of 4.10%.
Power up your portfolio for decades
Investors are talking more about defensive investments lately, and that’s no surprise given the volatility we’ve seen from the market in the past few weeks. Utilities make great defensive investments, and Fortis (TSX: FTS)(NYSE: FTS) should be near the top of any investor shopping list.
One of the most attractive aspects of a utility is the stable and recurring nature of its business model. In short, as long as the utility keeps providing the service it provides, the utility will continue collecting that steady stream of revenue.
That steady stream of revenue is passed on to investors in the form of a handsome dividend, which in the case of Fortis amounts to a 3.27% yield. Long-term investors can also take solace in the fact that Fortis has provided consecutive annual upticks to that dividend going back well over four decades.
In other words, Fortis is a great buy-and-forget stock for nearly any portfolio.
Look here for a growing income stream
Telecoms, like utilities, offer excellent long-term income-earning possibilities. Telus Corp (TSX: T)(NYSE: TU) is one of Canada’s Big Three telecoms and a solid candidate for any portfolio.
Telecoms offer subscription services that have historically included TV, Phone and Internet service. Cord-cutters and the growing reliance on wireless devices have chewed away at subscriber numbers over the years for most telecoms, but Telus is not most telecoms.
In the case of Telus, in the most recent quarter, wireless customer additions came in at 154,000, reflecting a 45% bump over the same period last year. Part of the reason for that bump stems from Telus’ approach to customer loyalty, which helps to keep churn to an industry-leading 1.01%.
Another point to note is Telus’ dividend. Telus currently offers quarterly payout with an impressive 4.57% yield, handily putting the stock near the top of any income-seeker’s shopping list. Adding to that appeal, Telus has provided annual or better hikes to that dividend for well over a decade, and is forecasting annual growth of 7-10% through 2022.
Final thoughts
The three companies noted above not only have growth and income-earning potential, but are also well-positioned to be defensive holdings that can weather a market slowdown, which many believe is around the corner.
In other words, buying these stocks now and holding them for a decade or more could prove to be beneficial not just for any short-term slowdown, but also for the long-term.
