There are plenty of high-quality stocks trading on TSX today. However, finding those with the perfect blend of growth, income, and value is difficult. That said, the task isn’t impossible.
The TSX happens to have some great options in this regard. Accordingly, those looking to boost their portfolio in a diversified way should consider these stocks.
Let’s take a look.
From a defensiveness perspective, Toronto-Dominion Bank (TSX:TD)(NYSE:TD) has proven itself a great long-term pick. Despite the downturn caused by the pandemic, shares of TD stock have soared to pre-pandemic levels and beyond.
Indeed, this Canadian bank continues to be among my top picks in this sector for a reason. The company’s leverage to an economic recovery is apparent. The company’s recent robust earnings reflect the removal of provisions for credit losses the bank was forced to put on its books a year ago. With this headwind seemingly nearing its end, investors have a bright outlook for the future.
Accordingly, TD’s dividend yield of 3.6% should be taken in the context of potential dividend growth. When allowed to do so, I expect TD to raise its dividend over time. The bank is sitting on a tonne of cash presently. And while various investment opportunities may ultimately reveal themselves, TD’s historical track record of returning value to shareholders is likely.
On this basis, I see value in TD’s existing valuation. Banks tend to be valued at a lower valuation multiple compared to other sectors. However, the cash flow growth potential of TD makes this stock one with tremendous growth, income, and value potential.
This company’s historical track record of growth is impressive. Accordingly, I think investors need to consider this stock on this basis alone.
Accordingly, Restaurant Brands’s current valuation is near the lower end of its long-term multiple. Investors appear to be factoring in more headwinds on the horizon. And there are reasons for this.
The company’s Tim Hortons banner, which still makes up the most significant chunk of the company’s revenue, has been struggling for some time. While these struggles have been offset by strong performance from the company’s Burger King and Popeyes Louisiana Kitchen banners, it’s still a company undergoing some internal turmoil.
However, I think this setup is perfect for long-term growth investors seeking stocks at a reasonable price. Restaurant Brands’s dividend yield in excess of 3% is the cherry on top. Indeed, I view this dividend as a freebie when long-term investors consider the growth potential of this company.
This regulated utility player holds an unmatched record dividend growth for nearly 50 years. Even amid the recent economic slowdown, Fortis offers investors a very meaningful dividend yield of 3.7%.
The company generates stable cash flow from its regulated utility business, allowing it to reinvest in its core business. This will enable Fortis to offer an increasing dividend to its unitholders.
In my view, its consistency coupled with excellent core business fundamentals continues to entice both growth and income investors. I think long-term investors and those who are nearing retirement could consider this dividend stock.
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 Chris MacDonald has no position in any stocks mentioned in this article. The Motley Fool recommends FORTIS INC and RESTAURANT BRANDS INTERNATIONAL INC.