With both the stock market and economic environments being so uncertain these days, many investors are finding it difficult to choose which stocks to add to their portfolio, especially with the strong likelihood of a recession on the horizon. Even with the uncertainty, though, there are high-quality and reliable stocks you can buy now and hold for years. Notable among them are Canadian infrastructure stocks.
Canadian infrastructure stocks are some of the few businesses you can buy with confidence today because infrastructure assets are crucial to our economy. Their necessity makes these stocks highly defensive.
The essential nature of infrastructure means that even if a severe recession were to hit, the majority of infrastructure stocks would see only minimal impacts on their businesses.
Furthermore, because these stocks are so reliable, they are some of the best to not only buy in this environment but also to hold in your portfolio for the long haul. For these reasons, they can be crucial to helping you build long-term wealth.
So if you’re looking for top stocks to buy in today’s environment, here are two top Canadian infrastructure stocks to consider.
A top Canadian infrastructure stock to buy and hold long term
One of the best and most defensive stocks that Canadian investors can buy, especially in today’s uncertain environment, is Brookfield Infrastructure Partners (TSX: BIP.UN). This defensive growth stock has significant long-term potential.
Brookfield owns essential assets all over the globe giving it a diversified portfolio of businesses that are crucial to the global economy. In addition to highly defensive assets such as utilities and midstream energy operations, Brookfield also owns assets in the transportation and data industries.
These include important assets such as ports, railroads, telecom towers and data storage centres, just to name a few. Besides owning many of these highly defensive businesses, Brookfield’s also constantly recycling capital and investing in new opportunities. This well-executed investment strategy is why it has so much long-term potential to create wealth for investors.
And on top of both its defensive and growth qualities, Brookfield is also a solid option for passive income seekers. This is because the cash flow it earns is highly reliable and predictable, making the dividend safe. Better still, management aims to increase its distribution by 5% to 9% every single year.
So if you’re looking for Canadian infrastructure stocks that you can buy now and hold for years, Brookfield is one of the best choices there is. Plus, it offers a yield of more than 4.2% today.
A top telecom stock
Another top Canadian infrastructure stock with highly defensive operations is BCE (TSX: BCE), the massive telecom stock.
Telecommunications is one of the most important sectors of the economy. As technology continues to improve, such as 5G and fibre, the industry’s importance only continues to grow.
Therefore, not only does this high-quality stock have a ton of long-term growth potential, but it’s also highly defensive. In other words, it should see only minimal impacts on its business should a recession materialize in the near term.
Another benefit of a Canadian infrastructure stock like BCE is that many of the assets it owns are long-life assets. For example, when it builds a telephone tower or installs fibre-to-the-home, this infrastructure can earn BCE revenue for years, which is why it’s such a cash cow.
Therefore, much like Brookfield, BCE is another excellent investment for passive income seekers as its dividend is highly reliable and constantly being increased every year as the company continues to grow and expand its business. Plus, today, its dividend offers a yield of more than 6.3%.
So if you’re looking for high-quality stocks that you can buy in this environment and ones that can help you grow your wealth for years and even decades to come, a top Canadian infrastructure stock like BCE is one of the best to buy now.
