As of this writing, the S&P/TSX Composite Index (SPTSX:IND) is up 18.25% year to date.
While that’s a great return, my Top Stock Picks for the Motley Fool this year have returned an average of 23.74%!
Strategies for picking a winning stock
When selecting stocks, I tend to select stocks that offer one of more of the following:
1) A healthy dividend that has been increasing every year
2) Defensive stocks that typically perform well regardless of market conditions
3) Companies that are spending strategically to aggressively grow revenue
Here’s a recap of my top three stocks in 2019 and why I still like them.
Choice Properties REIT
I chose Choice Properties REIT (TSX: CHP.UN) because of its strong balance sheet and its hefty dividend. The current dividend is 5.31%.
Stock in Choice Properties began the year trading at $11.62. As of this writing, the stock is trading at $13.89. That’s a gain of 19.54%.
As Canada’s largest REIT, the company focuses on supermarket-anchored shopping centres and standalone grocery stores. Loblaw is the company’s principal tenant.
REITs focused on tenants that provide consumer staples, like Choice Properties, are fairly insulated from a recession.
In September, the company sold 30 properties for $426 million. Cash from sales of existing properties gives the company the flexibility to either pay down debt or strategically add to its portfolio.
Metro
Companies that provide consumer staples, like groceries and medicine, are a good choice to protect your portfolio and help lessen the impact of an economic downturn.
That’s why I like Metro (TSX: MRU). The company operates 600 grocery stores and 650 drugstores throughout Canada under the well-known banners of Metro, Food Basics, Jean Coutu, and other recognized names.
Competition from companies like Amazon, which offer products in every market, make it crucial for grocery and drugstore retailers to keep up with the latest trends in the changing retail landscape.
Metro is investing heavily in options for online pickup and delivery, which is quickly becoming the preferred shopping method for today’s consumers.
As of this writing, the stock is up 20.17% year to date, trading at $56.95 at writing.
TC Energy Corporation
I chose TC Energy (TSX: TRP) because it offers the rare combination of steady growth and a nice dividend.
TC Energy currently pays a dividend of 4.4 %. This dividend has increased at a compound annual growth rate of 6.83% for nearly two decades.
The company isn’t expecting this trend to change and is forecasting that the dividend will increase 8% to 10% through 2021 and 5% to 7% in subsequent years.
As one of North America’s leading energy infrastructure companies, most of TC Energy’s revenue comes from long-term contracts.
While these commitments provide assurance in the company’s ability to continue and grow its dividend, the company is also forecasting significant earnings growth in the next few years.
TC Energy recently announced comparable EBITDA is expected to exceed $10 billion by 2022, representing an increase of more than 16% from 2018.
Shares of TC Energy are trading at $68.43 as of this writing. Thus far in 2019, the stock is up 31.50%.
