The TSX offers investors many options for long-term investing. Bank stocks in particular are amongst the best options for investors eyeing the long haul.
The banking sector is one of the strongest in Canada, and a key cog of the TSX. Canadian bank stocks are practically synonymous with long-term investing success.
These stocks offer not only solid share price growth, but also incredible dividend growth and stability. That’s a recipe which can lead to great total returns over a long time span.
Of course, all of the major bank stocks can be successful investments over time. However, each bank stock offers unique benefits which may appeal to certain individual investors.
So, it’s important for Canadian investors to focus on the bank stocks which align with their investment strategy. Today, we’ll look at two TSX banking giants with slightly different approaches.
RBC
Royal Bank of Canada (TSX: RY)(NYSE: RY) is one of the major Canadian bank stocks, and in fact the largest one by market cap.
RY is one of those top tier dividend stocks that investors have been able to rely on over time consistently. It offers investors both respectable share price growth and great dividend stability.
This banking giant has a unique portfolio of revenue sources that converge to offer investors a super reliable investing option. RY has a strong focus on lending in Western Canada and offers a wide range of products and services to its customers.
As of this writing, RY is trading at $132.80 and yielding 3.25%. While that’s not a massive yield, RY has plenty of runway to grow its dividend as the economy takes off.
That price proposition might not be considered a steal from a value perspective, but for long-term investors it’s not that relevant anyway. Over time, RY has the potential to deliver great total returns to investors.
Scotiabank
Bank of Nova Scotia (TSX: BNS)(NYSE: BNS) is another top performer amongst the Canadian bank stocks. It often offers a larger yield than its peers and has more aggressive growth opportunities.
BNS has a strong focus on developing reach in South America, which helps set it apart from its peers. It is willing to bet on these commodity-heavy economies and has committed to responding to economic growth there.
As such, some investors view BNS as one of the more volatile bank stocks, but it’s still a very stable stock in general terms. It’s simply a well-diversified stock with a strong base in Canada and interesting growth avenues elsewhere.
As of this writing, BNS is trading at $81.78 and yielding 4.4%. As with RY, BNS can easily manage that dividend and allow for it to grow going forward and benefit investors.
BNS is one of the top bank stocks for investors looking for international exposure and can easily deliver great results over time.
Bank stock strategy
Both RY and BNS are strong Canadian bank stocks with stable dividends and solid growth prospects. They each offer unique benefits to investors and can both be part of a solid long-term investing plan.
If you’re looking to scoop up some top bank stocks, be sure to give these two stars a good look.
