The Motley Fool

Got $1,000? Here Are 2 of the Best Canadian Energy Stocks to Buy in September

Gas pipelines
Image source: Getty Images

There are several sectors that are crucial to our economy, creating several investment opportunities for Canadians. One of those crucial industries is energy, which has some of the best stocks to buy now.

Energy is one of the most important industries there is. Besides the fact that you need the energy to do everything, it also makes up a significant portion of Canada’s economy.

Any tools we have, cars, machines, equipment at factories, have all been created to improve individuals’ efficiency and therefore grow our economy. However, these all rely on energy to run, which is precisely why it’s one of the most important industries in our economy.

There is a tonne of potential in the space, too. Several different subsectors and companies offer investors tonnes of choice. So, depending on your personal preferences, there are opportunities to find some of the best stocks to buy in energy.

My personal favourites are investments that are resilient and can be invested in for the long run. If you like to invest in growth stocks, though, you may prefer producers, especially junior producers, that can be considerably volatile and leveraged to the commodities they produce.

But in my view, for long-term investors owning a robust business that grows consistently is a much better choice.

So, with that being said, here are the two best Canadian energy stocks to buy this month.

This massive energy giant is one of the best stocks to buy and hold for years

One of the best stocks in Canada to own for the long run is the massive $100 billion company Enbridge (TSX:ENB)(NYSE:ENB).

Enbridge’s operations are so big that it’s crucial to the entire North American economy. The company transports a quarter of all the oil in North America and 20% of all the gas consumed by Americans.

It also has a massive utility business, which helps diversify and add more resiliency to the business. And it has a rapidly growing renewable energy portfolio, as it looks to the future. This portfolio is already the 12th largest in North America and only continues to grow.

Enbridge is one of the best energy stocks to buy now, though, because, on top of the fact it’s highly diversified, it also operates in an industry with massive barriers to entry.

This gives Enbridge a huge competitive advantage and makes the stock a major cash cow. So, investors can own this highly resilient business that pays a 6.7% dividend today, increases it consistently and continues to invest in expanding its business for years to come.

It’s easily one of the best energy stocks to buy for the long run, which is why it’s one to consider in September.

A rapidly growing energy infrastructure company

In addition to Enbridge, another high-quality stock for investors to consider is AltaGas (TSX:ALA). AltaGas is one of the best energy stocks to buy now, because it combines highly stable utility operations with a rapidly growing midstream energy segment.

One of AltaGas’s most promising growth projects recently was the Ridley Island Propane Export Terminal, which began bringing Western Canadian energy to international markets in 2019. This project is positive both for AltaGas and the Canadian energy industry as a whole.

In addition to these projects that have created some major value for the economy, AltaGas has also done incredible work to turn its whole business around.

It was only a few years ago that it was selling off non-core assets and paying down debt in an effort to get its company in a much stronger position. And that work has paid off handsomely.

Today AltaGas is easily one of the best Canadian energy stocks to buy for the long term. And in addition to all the capital gains potential it offers, it also pays a dividend that currently yields just under 4%.

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 Daniel Da Costa owns shares of ENBRIDGE INC. The Motley Fool owns shares of and recommends Enbridge. The Motley Fool recommends ALTAGAS LTD.

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.