The Canadian stock market is on the verge of wrapping on an incredible year. The S&P/TSX Composite Index may be losing steam, but the index is still up close to 20% in 2021.
The market has dropped about 5% over the last month, with many top TSX stocks falling much more than that. There’s certainly no shortage of buying opportunities on the TSX for long-term investors today — perfect timing for anyone that’s got some last-minute holiday shopping to do.
With that in mind, I’ve reviewed two top TSX picks that Canadian investors should have on their radar right now. And even if you’re all done with your 2021 shopping, you’d be wise to have these two companies on your watch list for the start of 2022.
TSX stock #1: Northland Power
It hasn’t been a great year for renewable energy stocks. Even with the market up big in 2021, many leaders in the renewable energy sector are trading far below all-time highs today.
Northland Power (TSX:NPI) is just one of many discounted green energy stocks on the TSX. Shares are down close to 30% from all-time highs set at the beginning of 2021. Still, the energy stock is sitting on a market-beating gain of 60% over the past five years.
Short-term investors may not be thrilled about the recent losses in the renewable energy sector. But for long-term investors, now’s the time to be loading up. There are clear tailwinds for the renewable energy sector, so it’s only a matter of time before the market-beating growth returns.
If you’re bullish on the growth potential of renewable energy, you’ll want to act fast. These discounted prices will not last long.
TSX stock #2: Sun Life
There’s a lot to like about Sun Life from an investment standpoint. Owning shares of the insurance stock can provide your portfolio with stability, passive income, and even market-beating growth potential.
Sun Life is far removed from the fastest-growing stocks on the TSX, and there’s absolutely nothing wrong with that. The two main reasons to be interested in the insurance stock are for stability and its dividend.
With all the volatility in the market right now, it’s not a bad idea to have a dependable insurance provider in your portfolio. Owning a company like Sun Life can help balance out some of the high-growth companies you may own.
In addition to stability, the TSX stock offers investors a top dividend. At today’s stock price, the company’s annual dividend of $2.64 per share is nearing a 4% yield. When you factor in that dividend, shares of Sun Life have outperformed the market’s return over the past five years.
Not only does Sun Life offer all that to its shareholders but it’s also trading at bargain prices. Shares are valued at a very reasonable forward price-to-earnings ratio over barely over 10. You won’t find many other high-quality companies on the TSX trading at that kind of valuation.