The Motley Fool

You Won’t Be Sorry You Bought These 2 TSX Stocks

The stock market has seen a tonne of volatility in 2020. There are several events impacting TSX stocks, making it difficult to track everything that’s happening.

When the market crashed in March, investors who weren’t ready, or panic sold their stocks lost a lot of money. At the same time, those who were prepared and were buying at the attractive prices have already seen the bulk of these stocks recover considerably. In some cases, stocks have even surpassed their pre-pandemic high.

With all this volatility and the potential to make or lose a lot of money in such a short period, its crucial investors pick the right stocks.

Not only will the wrong TSX stocks potentially cause you to miss out on the gains of the top companies, but you may even end up losing money.

Also, to avoid major losses, you’ll also need to commit to a long-term approach.

The theory behind investing is buying businesses that will continue to grow their earnings and, consequently, the value of their business. To do this takes time and years of strong execution by management.

If you are buying a stock expecting it to be higher in six months or a year from now, that’s a lot more speculative. Especially today, amidst so much uncertainty while we are in a global pandemic.

Here are the two best TSX stocks to buy today for the long-term.

TSX pipeline stock

Enbridge Inc (TSX:ENB)(NYSE:ENB) is known by many for its primary pipeline business, in reality though, the company is a total midstream energy conglomerate in North America.

The company is responsible for nearly a quarter of the oil and natural gas transported across North America. In addition, it has a major utility business in Ontario. Enbridge has also been investing in renewable energy projects as well.

The bulk of Enbridge’s business is still reliant on oil transportation. So it’s no surprise that with oil production down in Western Canada, there is concern from Enbridge investors.

However, Enbridge has significant competitive advantages. These can’t be overstated and help the company to mitigate the impact of the pandemic on its business.

The company is so resilient that for the second consecutive quarter since the start of the pandemic, Enbridge has reiterated its guidance for distributable cash flow this year.

The reiteration of guidance means that the TSX stock’s massive 7.4% dividend should continue to remain safe. And as the economy starts to emerge from the pandemic, look for a major uptick in Enbridge shares.

Asset manager

Brookfield Asset Management (TSX:BAM.A)(NYSE:BAM) may be one of the best stocks on the TSX. It has proven to be one of the best capital allocators and has even grown its share price by roughly 400% since the last recession.

For Brookfield, an environment such as our current one isn’t about survival. Instead, this is the best chance Brookfield has to find new distressed investments the company can buy at a discount.

The company has done this time after time. It has the ability to source and fund deals all over the world. This offers Canadian investors exposure to multiple projects around the globe.

Brookfield finds high-quality business that it can buy undervalued, then improves the business and the cash flow considerably. And the best time to find distressed businesses that are trading undervalued is during times of economic turmoil.

The TSX stock remains roughly 25% off its 52-week high, offering an excellent entry point for investors taking a long-term position.

Bottom line

This is one of the best years in recent memory for long-term investors to gain exposure to high-quality stocks for less than fair value. So don’t wait too long or you could miss out on the discount in these top TSX stocks completely.

Speaking of the top undervalued TSX stocks to buy.....

Just Released! 5 Stocks Under $49 (FREE REPORT)

Motley Fool Canada's market-beating team has just released a brand-new FREE report revealing 5 "dirt cheap" stocks that you can buy today for under $49 a share.
Our team thinks these 5 stocks are critically undervalued, but more importantly, could potentially make Canadian investors who act quickly a fortune.
Don't miss out! Simply click the link below to grab your free copy and discover all 5 of these stocks now.

Claim your FREE 5-stock report now!

Fool contributor Daniel Da Costa owns shares of ENBRIDGE INC. The Motley Fool owns shares of and recommends Brookfield Asset Management and Enbridge. The Motley Fool recommends BROOKFIELD ASSET MANAGEMENT INC. CL.A LV.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss an important event.

Iain Butler and the Stock Advisor Canada team only publish their new “buy alerts” twice a month, and only to an exclusively small group.

This is your chance to get in early on what could prove to be very special investment advice.

Enter your email address below to get started now, and join the other thousands of Canadians who have already signed up for their chance to get the market-beating advice from Stock Advisor Canada.

I consent to receiving information from The Motley Fool via email, direct mail, and occasional special offer phone calls. I understand I can unsubscribe from these updates at any time. Please read the Privacy Statement and Terms of Service for more information.