Seeing your investment rise and fall by double digits each day can be unnerving, to say the least. Investing, after all, is a long-term game. And for investors who don’t want to have to keep checking in on their stocks every day, you’ll want to focus on investments that aren’t volatile. That means buying shares of blue-chip stocks with strong businesses that are likely to stay that way for the foreseeable future. Here are two great options on the TSX for risk-averse investors.
Nova Scotia-based Emera (TSX:EMA) is an electric utility provider that serves 2.5 million customers across North America, including the Caribbean. Utility providers are normally recession-proof, since they provide a necessary service to their customers. But what makes the stock an attractive investment over the long term is its focus and commitment to greener energy. Emera has reduced greenhouse gas emissions by 35% since 2005 and plans to spend over $4 billion on cleaner energy through to 2022. It says it has also invested $13.4 million in its communities.
Focusing on cleaner energy and giving back to communities is a good way to win over its customers and investors, especially as concerns around climate change and the environment are on the rise.
And Emera’s business is already in great shape, generating a profit of $892 million over the trailing 12 months on revenue of $5.6 billion. That’s good for a solid profit margin of 16%. Its strong bottom line helps to support the company’s dividend payments, which yield 4.8%. With a payout ratio of just over 50%, there’s room for Emera to not just keep paying its dividend but also increase it, which is something investors have been used to over the years:
EMA Dividend data by YCharts.
Although shares of Emera are down 10% in the past 12 months, over the long haul it looks like a solid buy.
Another solid investment to put in your portfolio is BCE (TSX:BCE)(NYSE:BCE). The company’s broad array of products and services make this a very appealing option for risk-averse investors. From wireline to wireless to media, its product mix is diverse and helps BCE deliver strong results even in tough times. Over the past three quarters, the company’s operating revenue of $16.8 billion is down a fairly modest 4.2% from the same period last year. Its net earnings of $1.8 billion are down more than 30% from a year ago, as impairment expenses and other costs weighed down its bottom line.
However, as the economy slowly recovers from COVID-19 and people start traveling regularly, the company should see its numbers improve. Buying the stock now, while it’s down 12% from a year ago, could be a great opportunity. Its dividend yield is now up over 6% and that’s a solid payout for one of the TSX’s top stocks. Over a five-year span, it’s generally been a fairly stable investment, dropping just 3% in value. It can be an ideal alternative to putting your money into a bank where you’ll earn next to nothing these days. BCE might not generate much growth over the years, but it can make for a solid income investment to hang on to for decades.
Here are some more great stocks to consider:
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Fool contributor David Jagielski has no position in any of the stocks mentioned. The Motley Fool recommends EMERA INCORPORATED.