How many times have you wondered about investing in a business you just visited or passed? Sometimes known as everyday stocks, these options represent some of the best passive options to line your portfolio with. But where to start? What are the stocks you don’t think of but should?
Here are two options you’ve likely interacted with recently and why they belong in your portfolio.
Some milk, some gas, and lots of growth
Gas stations and the convenience stores they are connected to are odd businesses. They aren’t really a destination that people go to but rather serve as an interim stop for us to fuel up before going somewhere else.
But does that make them great investments?
Let’s look at Alimentation Couche-Tard (TSX: ATD) and try to answer that question.
Couche-Tard is one of the largest convenience/gas station operators anywhere. The company operates a massive network of over 14,000 stores across the U.S., Canada, and two-dozen other countries.
That massive footprint also contains a dizzying array of brands, including Circle K, Ingo, Holiday, and the company’s namesake, Couche-Tard.
The company’s massive size and necessity make it a defensive titan. Also, Couche-Tard’s aggressive stance on expansion has allowed it to gobble up smaller competitors and expand to new markets very quickly.
Throw in a series of record-breaking earnings reports and a slowly rising dividend, and you have an all-around great long-term investment.
Another interesting point is the increasing number of EV stations. This can elevate Couche-Tard’s stores to actual destinations for customers or at least make them spend longer times at the store.
In short, Couche-Tard is a great long-term option you probably don’t think of, but perhaps you should.
You need food. How about income?
Grocery stores are perfect examples of everyday stocks. We interact with them daily and may not think of them as investments.
This is where Metro (TSX: MRU) comes into play. Metro operates a growing number of grocery and pharmacies in Canada. Those locations are located primarily in Ontario and Quebec.
Apart from the necessity that Metro provides, why exactly should investors consider the stock? There are a few key noteworthy points.
First, let’s talk results. When the pandemic started and businesses were shuttered, grocery stores remained open. This led to a series of massive gains for grocers. Unfortunately, the supply-chain shortages that followed led to sharp price increases, which we’re still dealing with today.
Still, Metro’s results remain impressive. In the most recent quarter, the stock saw sales increase 1.9% to $4,274.2 million. Food same-store sales were also up, showcasing an impressive 11.5% year to date when compared to pre-COVID results. Overall, the company earned $198.1 million, reflecting a solid 5.3% increase.
Those positive results also mean that Metro can continue to provide its quarterly dividend. The yield currently comes in at 1.58%, making it respectable but hardly the best on the market. Additionally, prospective investors should note that Metro has an established history of providing annual upticks to its dividend. The series of upticks currently extends back over two decades.
In other words, Metro is one of the great stocks you don’t think of as an income and growth stock, but you really should.
Final thoughts on stocks you don’t think of too often
Finding that right mix of investments takes time and patience. Fortunately, both Metro and Couche-Tard are great long-term picks that could do well in any well-diversified portfolio.
Buy them, hold them, and forget about them for a decade or more.
