You don’t need a lot of money to build an investment portfolio. In fact, you can build a diversified portfolio of stocks with as little as $500. Here’s a five-stock beginner’s portfolio to buy with any extra holiday money you might get this year.
An anchor for any portfolio
TELUS (TSX: T) stock presents a great combination of growth and dividend income. It is the second-largest provider of cellular, internet, and cable services in Canada. These utility-like businesses provide steady earnings that support TELUS’s attractive 5% dividend.
TELUS is unique from other Canadian telecoms. It is building out several digital services businesses that are growing significantly faster than its communications business.
TELUS has been investing heavily in over the past two years, and the company is primed to earn a lot of excess cash in the coming few years. Right now, the company has a target to increase its dividend by 7-10% annually for the next few years.
A top dividend stock
Another dividend stock to consider adding in December is Brookfield Infrastructure Partners (TSX: BIP.UN). It operates essential assets like pipelines, railroads, ports, export terminals, utilities, and cell towers.
Over 90% of these assets are contracted/regulated, so it has a predictable baseline of earnings. This stock has a great combination of organic and acquisition growth. Brookfield has ample liquidity to deploy into acquisitions. This could be especially useful if infrastructure assets become cheap in a potential recession.
This stock is down 13% in the past month and trades with a 4% dividend. At 12 times funds from operations, it looks like an attractive buy here.
Growth-at-a-fair price stock
If you like adventure and fast fun, BRP (TSX: DOO) is a stock to consider. It owns a leading portfolio of recreational brands like Sea-Doo, Ski-Doo, and Can-Am. The company is incredibly innovative, and it has been gaining market share in the past few years.
The company has grown revenues by a compound annual rate over 12% for the five years. Earnings per share has compounded by 38% over that time frame!
The stock is down 5.5% this year. It only trades with a price-to-earnings ratio of 8.5. While there is some concern that its business could slow in a recession, if you take a long-term approach with this stock, you should do very well.
A diversified growth business
Another solid growth stock at an attractive price is Calian Group (TSX: CGY). Calian operates a conglomerate of businesses focused on healthcare, training, advanced technologies, and cybersecurity.
It has grown revenues and earnings by the mid- to high teens over the past five years, yet it only trades for 15 times earnings right now. The company has been fast improving margins and diversifying its customer base. It has a cash-rich balance sheet, so acquisitions are certainly on the table for further growth in 2023.
A top tech stock
Descartes Systems (TSX: DSG) is by far the priciest stock on this list, but it may also be one of the best quality. This tech stock provides crucial software and networks for the transportation industry.
Its business has done exceptionally well through the current supply chain crisis. Over the past three years, it has grown revenues and earnings by 15-20% a year.
Over 90% of its revenues are recurring. Likewise, it is incredibly profitable with an earnings margin near 40%. The company has $237 million in cash and no debt. Even if a recession hits and its business slows, it should be able to supplement growth with shrewd acquisitions.
