2 Stocks I’d Buy and Never Sell for 2022

Restaurant Brands International (TSX:QSR)(NYSE:QSR) can’t make you filthy rich overnight, but it can help power your TFSA to big gains this year.

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Buying stocks with the intention of never selling them seems pretty unrealistic. Even Charlie Munger, Warren Buffett’s right-hand man, can’t hold onto a stock forever, and Munger is one of the most patient investors you’ll ever come across today. With the rise of new-generation technologies, the disruptive impact is close to the highest it’s ever been. At risk are the moats of many incumbent players who’ve enjoyed decades of superior economic profits. Still, not all moats are built the same.

Some firms, like railway giant CN Rail (TSX:CNR)(NYSE:CNI), boast some of the most durable moats out there. It’s impossible to match CN Rail with its extensive network these days. Rest assured, no startup is going to start buying up track, given the enormous cost. Further, regulatory hurdles would prevent firms from doing so, even if they had tens of billions of dollars to spend on the construction of new track!

Other firms have narrower moats or a lack of any moat. Such firms can still be bought, but investors need to stay vigilant and re-evaluate their investments, even after they’ve picked up a considerable amount of stock. Such names may not be forever plays, making them less suitable for those who seek to “never sell” after they’ve bought.

In this piece, we’ll have a closer look at two names I’d feel comfortable not selling for years, if not decades at a time.

CN Rail

CN Rail is a top stock that should form the core of many Canadians’ portfolios for reasons outlined previously. The rail business has been highly profitable, and little has changed over the years. Moving forward, the advent of autonomous trucking capabilities could act as a pressure point. At the same time, Internet-of-Things, autonomy and electrification of locomotives are trends that should also work in CN’s favour, as it looks to trim costs and improve its profitability prospects.

Transporting goods long distances is where CN shines. Further, CN Rail can complement its end-to-end business with next-generation electric trucks to go to places where its trains can’t. For that reason, CN is far more innovative a company than most would give it credit for and a top candidate to continue dominating through the 2020s. It’s been a choppy 2021, but 2022 looks bright, as the firm goes on the hunt for its next leader.

It’s hard to believe that CN hasn’t been all that it could be. With the right CEO and a less COVID-disrupted environment, things are looking up for the old-time rail stock.

Restaurant Brands International

Restaurant Brands International (TSX:QSR)(NYSE:QSR) now owns four intriguing brands rich with growth prospects. Not only can QSR expand each of its cherished brands at the international level, it can also innovate at the in-store level to bolster same-store sales growth (SSSG). The perfect combo could lead to off-the-charts earnings growth in 2022.

In 2021, QSR battled COVID headwinds which weighed heavily on quarters. There are no easy ways around COVID and its impact on dining rooms. The company is ready to dodge and weave through further restrictions in 2022 en route to the endemic world that could see management put the foot back on the growth pedal. The fast-food business is durable, and it’ll be tough to keep QSR stock down once it makes it through this pandemic.

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 Joey Frenette owns Canadian National Railway and Restaurant Brands International Inc. The Motley Fool recommends Canadian National Railway and Restaurant Brands International Inc.

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