The longer we live with coronavirus, the more apparent it’s becoming what will happen going forward. Some TSX stocks have performed well, while others haven’t, and we will likely continue to see more divergence as we continue to get more clarity.
Every business is being impacted to one degree or another. It’s just as important to understand how much a company is affected as it is to know how long the impact could last.
When we start to look at companies this way, it becomes clear there are specific stocks and industries you’ll want to avoid. However, it also gives us industries that investors can rely on.
These two TSX stocks are not only highly reliable but also top growth stocks in their industries. This makes them highly ideal as investmentS today.
Because they are top businesses, they aren’t as undervalued as some other TSX stocks on the market, so investors should look to buy these names on relative weakness in the share price.
Telecom growth stock
The telecom industry is a great industry to invest in. In the short run, a lot of the cash flows of the company are stable and reliable. Plus, over the long run, there is tremendous growth potential.
The Canadian wireless industry is considerably less penetrated than those of comparable nations. Plus, the shift to 5G will create huge growth potential for years to come.
While the entire industry is attractive, Shaw Communications (TSX:SJR.B)(NYSE:SJR) is the best long-term telecom growth stock on the TSX.
The company has always had a strong wireline business in Western Canada. And with its growing wireless business, Shaw has more potential for growth over the long term than its Big Three peers.
This makes it a great investment today, because you can be confident in its ability to stay resilient. However, when the economy starts to pick up again, we will soon see its business begin to explode with growth.
At current prices, the stock is nearly 20% off its 52-week high. However, there is significantly more upside than that over the long term.
Plus, at current prices, Shaw shares yield roughly 5.2%. This is an attractive yield to hold as you wait for your capital to appreciate. The stability, long-term growth, and prudent management team make Shaw a top stock to count on in this crisis.
Green energy TSX stock
Another top long-term stock to consider investing in is Northland Power (TSX:NPI).
Northland is one of the fastest-growing renewable energy stocks on the TSX. Green energy will be one of the best long-term growth industries over the next few decades, and Northland is at the front of the pack.
Currently, the company has just over 2,000 megawatts of generating capacity; however, with more than 1,000 megawatts under development, its capacity is expected to expand by roughly 50% in the near term.
Not only is green energy a top long-term growth industry, but it’s also a highly stable industry that can protect your capital in a recession.
Northland currently has more than 90% of its capacity contracted for this year and has power-purchase agreements with a weighted average duration of more than 10 years.
This gives the company significant stability and makes its dividend that much more reliable.
As of Friday’s close, Northland stock offers investors a monthly dividend, which yields roughly 3.9%. So, not only can you expect long-term growth from Northland, but it will also return cash to you in the meantime.
Just like Shaw, Northland’s long-term growth potential plus the stability of its revenue make it the perfect stock to buy today.
Both these TSX stocks are superior businesses with considerable long-term potential, making them two of the best choices to invest in today. The companies have resilient operations, allowing them to protect your capital.
Investors can buy the stocks today knowing they are investing in robust businesses that will set them up for significant long-term appreciation.
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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 Daniel Da Costa owns shares of NORTHLAND POWER INC.