After all the recent uncertainty in markets and the volatility that comes with it, many investors have been hesitant to put their cash to work in this environment. However, this actually an exceptional time to buy high-quality stocks while they trade cheaply, particularly stocks that you can buy and hold until retirement.
When you can find companies that have incredible businesses and can continue to grow and expand their operations through thick and thin, then no matter what happens in the market or economy over the short run, they are stocks you can count on for the long run.
So, if you have cash that you’re looking to invest today, here are two of the best Canadian stocks to buy now that you can plan to hold until retirement.
A top Canadian utility stock to buy and hold for decades
In this environment, one of the best stocks that you can buy now is Algonquin Power and Utilities (TSX: AQN)(NYSE: AQN).
Algonquin is an exceptionally defensive company due to its utility operations that account for roughly three-quarters of its business. Utility operations are always some of the safest businesses to invest in due to their importance to the economy and the fact that the industry is regulated by governments.
In addition, Algonquin’s utility operations are diversified well. The stock offers water, gas and electricity services across several states south of the border.
This allows Algonquin to constantly earn tonnes of cash flow, which it uses to fund its dividend, but also to invest in continuing to grow its operations.
The fact that it’s so safe should give investors the confidence to buy and hold no matter what the market conditions are, especially in today’s highly uncertain environment.
In addition, because the stock also owns and operates green energy generating facilities, it’s a business that has a tonne of long-term potential.
Furthermore, just recently, Algonquin also initiated a capital-recycling program, where it will look to sell off more mature green energy assets, which can fetch a higher price. It can then use the new capital to invest in building new green energy facilities. And because building renewable infrastructure is so crucial to slow down the effects of climate change, the stock has decades of growth potential.
So, while Algonquin trades undervalued, there’s no question it’s one of the best stocks you can buy. Currently, Algonquin trades at a forward price-to-earnings ratio of just 18.6 times. That’s below its five-year average of 19.3 times in a market environment where safe utility stocks should be some of the most in-demand companies you can buy.
Furthermore, Algonquin’s dividend offers an impressive yield of over 5% and has increased its payout at a compounded annual growth rate of 8.9% over the last half-decade.
Therefore, if you have some cash to invest today, and are looking for reliable stocks that you can buy and hold for the long haul, then there’s no question Algonquin is one of the best to consider today.
One of the best real estate stocks you can own
In addition to utilities, another excellent industry to invest in for the long haul is residential real estate. That’s why Canadian Apartment Properties REIT (TSX: CAR.UN) is one of the best stocks you can buy now.
CAPREIT, as it’s known, is the largest residential REIT in Canada, owning over 60,000 properties across Canada. It even owns some units in Europe.
This diversification makes the already reliable stock even safer, plus it also exposes CAPREIT to different opportunities for growth.
In addition, much like Algonquin, CAPREIT offers an attractive distribution funded by steady and reliable cash flow. However, it does pay slightly less back to investors, currently offering a yield of 3.2%, as it keeps more cash to invest in long-term growth.
This makes it an ideal stock for investors that are still looking to earn passive income but also want a higher potential for capital appreciation.
In just the last three years, the stock has grown its revenue by 36% and its funds from operations by 38%.
Therefore, if you’re looking for top Canadian stocks that you can buy with confidence in this uncertain environment, CAPREIT is one of the best to consider today.
