2 Top Stocks to Buy for a Wealthy Retirement

You can generate wealth during a recession by buying Franco-Nevada Corporation (TSX:FNV)(NYSE:FNV) and Waste Connections Inc. (TSX:WCN)(NYSE:WCN).

| More on:

Image source: Getty Images

Franco-Nevada (TSX:FNV)(NYSE:FNV) is based in Toronto. The company is a gold-focused royalty mining company. Franco-Nevada invests in gold, silver, platinum group metals, other mining assets, and energy. Most Franco-Nevada’s assets (63%) are in gold companies.

The stock pays a dividend of 1.04% and has a market capitalization of $23.68 billion. In 2018, Franco-Nevada had $653 million in revenues.

Gold streaming is a unique way to protect against a recession. Gold streaming allows investors to profit from rising gold prices without the risk of one vein running out, production problems, or confiscation by a government. In the event of personal gold holdings or a gold mine confiscation, an investor in Franco-Nevada would make money because the global price of gold would increase.

Franco-Nevada is insulated from political turmoil in one country because the company owns global assets.

There is a lot of economic uncertainty in global markets. Denmark is currently experiencing negative interest rates. On July 3, 2019, the Danish government sold a 10-year bond at -0.32%. This means investors will knowingly lose -0.32% on the money they placed in addition to any purchasing power depreciation that may be experienced over the life of the bond.

Switzerland, Japan, the Eurozone, and Sweden all have negative interest rates at their central banks.

If investors cannot gain returns from traditional safe havens such as government bonds, they will turn to invest in another historical store of wealth: gold.

By 2021, the projected price for one ounce of gold will be US$2,000. That is a 25% increase from the current price.

It is essential to keep in mind that Franco-Nevada also streams silver and platinum assets. Silver is a store of wealth and an industrial metal. Only 25% of silver mined is used for jewelry and utensils. Silver demand was up 4% in 2018, and projections for demand remain strong given silver is a component used in the manufacturing of solar panels and electronics. Silver prices are expected to increase 21% by 2020.

All these indicators bode well for stock price increases for Franco-Nevada.

Waste Connections (TSX:WCN)(NYSE:WCN) is my second top pick for a wealthy retirement. The Canadian headquarters are in Vaughn, Ontario. The company provides waste removal and disposal, recycling, and composting services. The stock has a five-year total return of 199.45%. In 2018, the company had US$4.92 billion in revenues.

Waste Connections is the third-largest solid waste management company in North America and has multiple revenue streams.

In 2015, the company opened the largest renewable natural gas facility in Canada in Terrebonne, Québec. The facility converts gas from its landfill into natural gas and feeds the gas into the TransCanada pipeline network.

The company also recycles industrial materials such as plastics, oil, and chemicals.


On January 17, 2019, CBC reported more than half of all food in Canada is lost or wasted. This presents a significant opportunity for Waste Connections to expand the company’s natural gas operations.

In 2018, China stopped importing the world’s recycling. China’s refusal to take on recyclables has plunged the recycling industry into chaos. That means the waste is staying in Canada and it’s up to Canadians to figure out what to do with it. One such initiative is the National Zero Waste Council in which Waste Connections can leverage the company’s deep ties with municipalities to forge partnerships with industry.

Canada is hosting the 2020 Circular Economy Forum. A circular economy means existing non-used items are recycled into other resources. The economic benefits for the transition to a circular economy are estimated to be $4.5 trillion. Waste Connections needs to be part of that conversation.

With 66 recycling facilities throughout North America, Waste Connections has the infrastructure to accommodate growing demand for recycled goods.

Revenues for Q2 2019 were up 10.5% compared to Q2 2018, and the company had 19.3% of revenue in free cash flow. This company is on solid ground.

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.ca contributor Renée Gendron has no position in the mentioned stocks. 

More on Metals and Mining Stocks

tsx today
Metals and Mining Stocks

TSX Today: Why Canadian Stocks Could Fall on Monday, December 4

The commodity market’s heavy losses in early trading could drive the main TSX index downward at the open today.

Read more »

A miner down a mine shaft
Metals and Mining Stocks

2 Top TSX Mining and Materials Stocks to Buy for December 2023

You can buy these two TSX mining stocks in December 2023 to expect market-beating returns in the long run.

Read more »

Watch for the Warning Signs Stock Market Prices Trends 3d Illustration
Dividend Stocks

Where Smart Money is Going as Canadian Interest Rates Climb

The interest rate climb is nearing its end. Smart investors are using this trend to invest in stocks with an…

Read more »

stock market
Metals and Mining Stocks

Time to Invest in Gold? 2 Shining Miners to Watch in 2024

Agnico Eagle Mines (TSX:AEM) and another TSX gold miner that could rise sharply into the new year and beyond!

Read more »

Nuclear power station cooling tower
Metals and Mining Stocks

Cameco Stock Is up 92% This Year: Is it Still a Buy?

Cameco (TSX:CCO) stock could have more room to run, as nuclear power experiences a massive comeback.

Read more »

tsx today
Metals and Mining Stocks

TSX Today: What to Watch for in Stocks on Thursday, November 30

The main TSX index remains on track to end November on a strong bullish note, as it has already risen…

Read more »

Gold bars
Metals and Mining Stocks

Are Gold Stocks the Answer to Canada’s Growing Interest Rate Dilemma?

Gold price surged to its six-month high as market expects growing interest rate to ease from next year. How can…

Read more »

tsx today
Metals and Mining Stocks

TSX Today: What to Watch for in Stocks on Wednesday, November 29

Mix commodity prices could keep the main TSX index flat at the open today, as investors watch the quarterly U.S.…

Read more »