When you start investing, it can be overwhelming at first. There are so many different stocks of all different sizes across several sectors and industries. So it’s not surprising to find it difficult to decide which stocks to buy when you first start.
However, when you have a clean slate to build a portfolio from scratch, it actually gives you more opportunity. You can build your portfolio however you see fit and stick to buying only the highest-quality stocks in Canada.
Eventually, you’ll notice that as the market cycles, different stocks become the best opportunities over time as the market environment changes and the economy evolves.
For example, two years ago, many tech stocks were rallying while energy stocks were plummeting. Over the last few months now, it’s been the exact opposite. Energy stocks have been top performers, while tech stocks have fallen out of favour.
So with that in mind, in the current market environment, here are three of the best stock to buy now.
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A top growth stock to buy if you want to start investing
Dollarama (TSX:DOL) is one of the best-known brands in Canada, but it’s also one of the top stocks you can buy, especially if you’re looking to start investing.
Dollarama is an excellent choice because it’s a top growth stock, but it’s also quite defensive. Because of Dollarama’s business model, it’s a stock that can better handle the impacts of inflation and may end up even benefitting from it. Furthermore, because Dollarama sells a lot of essential items, much of its sales are robust too.
So it’s an ideal growth stock to buy in this environment, but if you’re buying Dollarama, you’re buying it for its long-term potential.
For years it’s opened tonnes of new stores while also growing the sales at its existing stores. So it’s no surprise shareholders have earned a total return of 865% over the past decade, and that will only continue to grow.
Therefore, if you’re going to start investing and want a top growth stock that you can buy now, Dollarama is one of the best.
A top value stock
Not everyone wants to buy growth stocks, especially when they trade at significant premiums. Another option is to buy value stocks, companies that are trading undervalued.
What to know about value stocks is that just like growth stocks being expensive and trading at a premium, there is almost always a reason for a stock trading cheap. Whether that reason warrants a discount in the stock is up to you to decide.
So if you’re looking for a value stock to buy when you start investing, a company like Corus Entertainment (TSX:CJR.B) is an excellent example.
The company ran into trouble a couple of years ago due to high debt loads. And then, as it was in the midst of its turnaround, it was impacted at the start of the pandemic.
Throughout all of this, though, Corus has remained resilient. Its business operations are in much better shape today, and thanks to all the free cash flow it’s been earning over the past few years, the company has been able to reduce its debt quite considerably.
So with Corus having much less risk today but still being an ultra-cheap value stock, which also happens to have a current dividend yield of 4.9%, it’s the perfect stock to buy if you’re looking to start investing.
A top Canadian dividend stock
Some investors want to start investing for all the capital gains they can make down the road. But many others are looking to start earning cash today, especially passive income, which is why you may want to consider a top dividend stock like Freehold Royalties (TSX:FRU).
Freehold is a royalty company that receives payments from energy companies producing oil and gas on its land. So it’s a lot like an energy producer, only with a lower-risk business model. Therefore, in this environment, Freehold has a tonne of momentum.
And over the long run, it can be an excellent dividend stock, returning stable passive income as its current payout ratio is just 60%.
Therefore, if you’re looking to start investing and earning passive income, Freehold is one of the best dividend stocks you can buy.
