CPP: Where Is Your Money Invested?

The CPP invests in stocks like WSP Global (TSX:WSP) which should be on your radar.

| More on:
Where to Invest?

Image source: Getty Images

The Canada Pension Plan (CPP) is one of the world’s most robust government-controlled retirement schemes. Unlike other countries, Canada’s pension pot is wisely invested and well funded, which means anyone paying into the scheme today can expect a payout when they get old. 

That said, the average Canadian taxpayer has no clue where or how their CPP contributions are invested. If you’re a taxpayer or a pensioner, here’s what you need to know. 

CPP investment portfolio

The CPP investment board is a group of professionals who’ve been managing these critical assets for 75 years. Over the past ten years, their nominal returns have been 9.9% on average annually. Last year, they generated 3.1% in net return and assets under management have surged to $409.6 billion. 

In short, every Canadian can sleep well knowing their retirement is secured by the government. The portfolio is also well-diversified across private equities, direct credit securities, real estate, emerging market assets and infrastructure. However, the largest allocation (28%) is to public equities. 

Here are two Canadian stocks the CPP investment board holds right now.  

CPP stocks

The taxman’s portfolio includes Montreal-based consulting firm WSP Global (TSX:WSP) and specialty food manufacturer Premium Brands Holdings (TSX:PBH). Both could be considered safe value investments that you should consider adding to your personal portfolio too. 

Premium Brands Holdings has shrugged off the retail apocalypse triggered by COVID-19. While retailers that rely heavily on foot traffic have capitulated, the specialty food manufacturing and distribution company has remained resilient. The stock is already up by more than 50% from 2020 lows and looks set to finish the year at one-year highs.

PBH has survived the onslaught in the retails sector by focusing on niche food items and products that continue to elicit strong demand amid the pandemic. The company also boasts of a robust portfolio made up of Audrey’s, Conte Food, and Expresco.

The niche product line and brands have allowed the company to profit from a loyal customer base affirmed by substantial cash flows. In the third quarter, revenue was up 13.7% to $1.1 billion. Organic growth was up to 12.5% from 9.1%. Besides, the company reported a record EBITDA of $93.5 million. It also reported record adjusted earnings per share of $1.07 a share.

WSP Global

Meanwhile, WSP stock has nearly doubled in value since early-2020. After a 90% plus rally and currently flirting with record highs.

 The company’s stellar performance stems from the fact that its core business revolves around helping government agencies and private firms manage infrastructure projects. The company offers professional consulting services in the U.S, Canada, Europe, and the Middle East. Its core business revolves around advising, planning, designing, and managing projects around rail transit aviation, highways, and bridges.

At a time when most companies in the sector were reporting a double-digit decline in revenues owing to COVID-19 disruptions, WSP Global reported $2.1 billion in net revenues, a mere 0.4% decline. Backlog as of September was at 11.6 months high of $8.5 billion as net earnings attributable to shareholders rose 11.3% to $104.3 million or $0.92 a share.

Bottom line

The CPP’s track record as a savvy investor makes their portfolio holdings noteworthy. Investors should take a closer look at WSP Global and PBH. 

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 Vishesh Raisinghani has no position in any of the stocks mentioned.

More on Investing

Nuclear power station cooling tower
Metals and Mining Stocks

If You’d Invested $1,000 in Cameco Stock 5 Years Ago, This Is How Much You’d Have Now

Cameco (TSX:CCO) stock still looks undervalued, despite a 258% rally. Can the uranium miner deliver more capital gains to shareholders?

Read more »

Businessman holding tablet and showing a growing virtual hologram of statistics, graph and chart with arrow up on dark background. Stock market. Business growth, planning and strategy concept
Dividend Stocks

TFSA Magic: Earn Enormous Passive Income That the CRA Can’t Touch

If you're seeking out passive income, with zero taxes involved, then get on board with a TFSA and this portfolio…

Read more »

Man with no money. Businessman holding empty wallet
Dividend Stocks

2 Stocks Under $50 New Investors Can Confidently Buy

There are some great stocks under $50 that every investor needs to know about. Here’s a look at two great…

Read more »

potted green plant grows up in arrow shape
Stocks for Beginners

3 Growth Stocks I’m Buying in April

These three growth stocks are up in the last year, and that is likely to continue on as we keep…

Read more »

clock time
Tech Stocks

Long-Term Investing: 3 Top Canadian Stocks You Can Buy for Under $20 a Share

These three under-$20 stocks offer excellent buying opportunities for long-term investors.

Read more »

Arrowings ascending on a chalkboard
Energy Stocks

Beat the TSX With This Cash-Gushing Dividend Stock

Canadian Natural Resources stock is well set up to beat the TSX as it continues to generate strong cash flows…

Read more »

think thought consider
Dividend Stocks

Down 10.88%: Is ATD Stock a Good Buy After Earnings?

Alimentation Couche-Tard (TSX:ATD) stock might not be the easy buy-case it once was. Here’s a look at what happened.

Read more »

money cash dividends
Dividend Stocks

TFSA Dividend Stocks: Earn $1,200/Year Tax-Free

Canadian stocks like Fortis are a must-have in your portfolio to earn tax-free yields for decades.

Read more »