The best part about stocks is that you do not need a large sum of money to start investing. All it takes is strict discipline to invest regularly and stay invested for the long term. So, if you can spare $500, consider buying these top TSX stocks right now for outsized returns in the long run.
Goodfood Market (TSX:FOOD) stock has corrected significantly and is down about 33% this year. However, I see the dip in Goodfood Market as an excellent opportunity to buy this high-growth stock at current levels. The continued spending on e-commerce platforms and increased adoption of online grocery services provide a solid base for growth.
Goodfood Market is witnessing stellar growth in its active customer base, which is encouraging. Meanwhile, its investments to reduce the delivery time bode well for future growth. I believe its growing scale, increased penetration of delivery capabilities, and expanded product selection could continue to drive its customer base and drive its stock higher in the long run.
Cineplex (TSX:CGX) stock took a significant beating, as the COVID-19 pandemic wiped out its revenues and led to massive losses. However, I am bullish on Cineplex stock for the long term and expect the company to deliver solid revenues and earnings, as it returns to normal operating conditions.
Notably, Cineplex stock has recovered some of its lost ground and is up about 148% in six months. However, it’s still trading a considerable discount compared to pre-pandemic levels. I believe vaccine distribution, reopening of theatres and entertainment locations, tight expense management, and recovery in consumer demand could help the company return to profitability and significantly boost its stock.
Algonquin Power & Utilities
I expect Algonquin Power & Utilities (TSX:AQN)(NYSE:AQN) to continue to deliver stellar shareholders’ returns in the future years, thanks to its low-risk and high-growth assets. Its regulated and contracted utility assets generate predictable cash flows, drive earnings, and support higher dividend payments. The company has increased its dividends by about 10% annually in the last 11 years and offers a yield of 3.9%.
I believe with continued growth in its rate base and growth opportunities in the renewable power business, Algonquin Power & Utilities’s adjusted EBITDA and earnings could continue to grow at a double-digit rate. Meanwhile, its dividends could increase at a decent pace in the coming years.
Pembina Pipeline (TSX:PPL)(NYSE:PBA) could deliver strong growth on the back of the recovery in energy demand. The company is likely to continue to boost shareholders’ returns through share buybacks and higher dividend payments.
I believe economic expansion could drive demand, volumes, and pricing for commodities that Pembina transports. Meanwhile, new projects and higher backlogs suggest that Pembina Pipeline could deliver strong adjusted EBITDA in the coming quarters. Furthermore, its diversified and highly contracted assets and strong fee-based cash flows indicate that it could continue to hike dividends in the coming years. Also, Pembina stock is trading at a lower valuation than peers and offers a high yield of 6.8%.
Lightspeed POS (TSX:LSPD)(NYSE:LSPD) stock is a solid long-term bet. The continued shift towards the multi-channel payment platforms is likely to drive demand for Lightspeed’s payment software and e-commerce services. Further, new products and up-selling opportunities are likely to support its growth.
Notably, Lightspeed is also expected to benefit from its appetite for acquisitions. The company’s recent acquisitions have driven its customer base higher, accelerated revenue growth, and solidified its competitive positioning in high-growth markets. I believe opportunistic acquisitions, growing scale, strong average revenue per user, geographic expansion, and secular industry trends provide a multi-year growth opportunity for Lightspeed.
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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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool owns shares of Lightspeed POS Inc. The Motley Fool recommends CINEPLEX INC., Goodfood Market, and PEMBINA PIPELINE CORPORATION.