New to Investing? 2 Top Stocks Every Canadian Should Own

New and seasoned investors alike should diversify for long-term income and growth potential. Here are two top stocks every Canadian should own.

| More on:
A person builds a rock tower on a beach.

Source: Getty Images

New investors often struggle to find that perfect mix of investments that can provide long-term growth and income. Fortunately, the market gives us plenty of options to choose from, including some great top stocks every Canadian should own.

Here are some of those options to consider adding to your portfolio today.

A defensive stock that promises growth and income

One of the first top stocks every Canadian should own is Fortis (TSX:FTS)(NYSE:FTS). For those that are unaware of the company, Fortis is one of the largest utilities in North America.

The company boasts a whopping 10 operating regions across the U.S., Canada, and the Caribbean. Collectively, Fortis’s operation comprises a predominately regulated portfolio that has both gas and electric elements.

Those operations are overwhelmingly regulated, which means that Fortis generates a stable and recurring source of revenue. Keep in mind that Fortis’s business is largely immune to the volatility we’ve seen this year.

Furthermore, that stable revenue stream allows Fortis to invest in growth and provide a handsome income to investors. In recent years, Fortis’s growth focus has turned towards upgrading existing facilities and transitioning towards renewables. The company has a massive capital improvement fund to help fund those upgrades.

Turning towards income, Fortis boasts one of the best and most consistent dividends on the market. Fortis pays out a quarterly dividend, which currently works out to a yield of 3.67%. In addition to that juicy yield, investors should note that Fortis has provided annual upticks to that dividend for an incredible 48 consecutive years.

Fortis is also forecasting that trend to continue through 2025, with the annual 6% uptick sending the stock into Dividend King territory. For potential long-term investors, that just screams buy and forget.

To put it another way, Fortis is one of the most defensive and stable stocks on the market. This makes it one of the must-have top stocks every Canadian should own.

Top stocks every Canadian should own: Enbridge

Most Canadians are familiar with at least one part of Enbridge (TSX:ENB)(NYSE:ENB). What most investors may not realize is just how big the energy behemoth, truly is.

Enbridge is best known for its massive pipeline network. The pipeline generates the bulk of Enbridge’s revenue and is often the source of controversy and protest by various groups. Still, that pipeline network which stretches over 28,000 kilometres is one of the largest and most complex operations on the planet.

More importantly, that substantial pipeline network is responsible for transporting one-third of all the crude produced in North America. Enbridge also hauls nearly one-fifth of the natural gas needs of the U.S.

Perhaps best of all, the revenue generated from that network is not based on the volatile price of commodities. That’s part of the reason why the network is often compared with a toll-road network.

As impressive as that pipeline network is, there are other noteworthy segments to note.

Specifically, Enbridge operates one of the largest gas utility businesses on the continent and boasts a growing renewable energy business. That renewable energy business in particular represents a unique long-term opportunity for the company.

Over the past two decades, Enbridge has injected over $8 billion into the segment. In doing so, Enbridge has built out a huge global portfolio of solar, wind, hydro, and geothermal facilities. Collectively, those facilities have a net generating capacity of 2,175 MW, which is enough to power 967,000 homes.

Finally, let’s talk dividends. Enbridge boasts one of the best yields on the market. Enbridge’s quarterly dividend currently carries a yield of 6.33%. This means that a $40,000 investment in Enbridge will earn over $2,500 in just the first year.

That fact alone justifies Enbridge on a list of top stocks every Canadian should own.

Final thoughts

No stock is without risk. That’s a key point to consider when compiling a list of top stocks every Canadian should own. Fortunately, both Enbridge and Fortis boast defensive operations that will continue to grow and generate a handsome income for decades.

In my opinion, one or both should form part of any well-diversified portfolio.

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 Demetris Afxentiou has positions in Enbridge and Fortis Inc. The Motley Fool recommends Enbridge and FORTIS INC.

More on Stocks for Beginners

A stock price graph showing declines
Dividend Stocks

Here’s Why I’m Confident About Investing Through the Down Market

There is no bear market in history that has not been followed by a bull cycle. Rather than fret over…

Read more »

A bull and bear face off.
Stocks for Beginners

2 TSX Stocks to Buy in a Recession

Are you worried about a recession? Top TSX stocks like Fortis and Dollarama may be perfect investments for a future…

Read more »

edit Close-up Of A Piggybank With Eyeglasses And Calculator On Desk
Stocks for Beginners

How to Turn a $6,000 TFSA or RRSP Into $600,000

You can retire comfortably early if you do some serious retirement planning. Investing regularly in your TFSA and maybe your…

Read more »

Businessman holding tablet and showing a growing virtual hologram of statistics, graph and chart with arrow up on dark background. Stock market. Business growth, planning and strategy concept
Stocks for Beginners

3 TSX Stocks You’ll Wish You Bought at These Prices

Stocks are currently trading at unbelievable discounts. Here are three TSX stocks you’ll wish you had bought at these prices!

Read more »

funds, money, nest egg
Stocks for Beginners

No Time to Invest? The Easiest Way to Create a Million-Dollar TFSA

Here’s how investors can take advantage of a recent market crash to create a million-dollar TFSA with ease.

Read more »

Volatile market, stock volatility
Bank Stocks

Here’s Why I’m Confident About Investing in a Down Market

This down market continues to trade near 52-week lows, providing you with a small window of time where you can…

Read more »

A red umbrella stands higher than a crowd of black umbrellas.
Stocks for Beginners

2 Safe Stocks to Buy for a Bear Market

As the market conditions continue to worsen as we begin the fall, safe stocks, such as these two, are some…

Read more »

A red umbrella stands higher than a crowd of black umbrellas.
Stocks for Beginners

3 of the Safest U.S. Stocks Right Now

Are you looking for some safe stocks to weather volatility? Here are some of the safest U.S. stocks to consider…

Read more »