The Motley Fool

3 Ways to Earn 105% in 2021 — and Keep CRA Away

Image source: Getty Images

There are plenty of articles out there telling investors which stocks to buy at super low prices. However, there are very few stocks that could see the potential return of 135% in a year. That’s what I’m hoping to show you today. There are a number of stocks that are even trading at all-time highs, and yet still have the strength to keep going. Then, there are those that are due for a huge rebound. So that’s what I’ll be covering today.

Even better, with all of our financial futures in a bit of limbo, you can still make these returns tax free. All you need is to start off with a Tax-Free Savings Account (TFSA). By investing in these three stocks, you give your TFSA portfolio an amazing chance of reaching 135%, or even beyond.

Algonquin Power

You don’t have to get into risky stocks to see huge returns. In fact, Algonquin Power & Utilities Corp. (TSX:AQN)(NYSE:AQN) is a great stock for the next year, and decades from now. The company is supported by its utility business, which is booming. Even when there is a market downturn, people need the lights on. Now that businesses are opening up again, that means Algonquin will be right back where it was before the pandemic.

But further down the line, Algonquin has the chance to become a powerhouse. That’s because it’s also invested in renewable energy resources. As governments invest less in oil and more in renewable sources, companies like Algonquin will get all those funds. But luckily, it won’t have to start from scratch thanks to its utility business keeping it strong.

The stock has been easily outpacing the markets since January. Beyond that, it has a compound annual growth rate (CAGR) of 21% for the last decade, and a return of almost 175% in the last five years. But the stock should see a huge boost with revenue returning to normal, so expect a bump on November 7 with its quarterly earnings report.

Pembina Pipeline

Sure, renewable energy will get future cash, but Pembina Pipeline Corp. (TSX:PPL)(NYSE:PBA) can give you cash right now. That’s in two ways. The company has an incredible 8.62% dividend yield as of writing, which you can use to reinvest. But it’s also trading way lower than it should be.

Economists predict Pembina to soar to around $60 per share when the markets rebound. That’s an increase of 107% as of writing! So although the last few years have been rough, the stock should jump due to its current projects.

Pembina has a number of pipeline projects set to come online in the next few years. This should help solve the glut in oil and gas, boosting the company’s bottom line. Meanwhile it’s still supported by long-term contracts to keep it going for decades.

Kirkland Lake

Kirkland Lake Gold Ltd. (TSX:KL)(NYSE:KL) has had a banger year, even for a gold miner in a booming industry. The stock has been in acquisition mode, giving it a diversified portfolio around the world. Even though the stock is reasonably young, it’s given investors an incredible 302% return in the last three years.

While other companies have been trending down, Kirkland Lake has seen revenue go up and up. During the latest quarter, the company saw year-over-year returns of 77.2%. With the next earnings report coming out Oct. 30, investors should prepare themselves for more solid growth. This should continue to happen as long as the company continues to make solid acquisition.

Bottom line

All three of these stocks are outpacing the markets, or are completely undervalued. As the stock market rebounds, each should still see a huge jump in share price. If another crash happens, you could earn at least 100% from each of these stocks! And of course, if you put all this in your TFSA, this will all be tax free from the CRA!

Here are even more opportunities to consider!

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 Amy Legate-Wolfe owns shares of PEMBINA PIPELINE CORPORATION. The Motley Fool recommends PEMBINA PIPELINE CORPORATION.

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.