Some of the best opportunities of the past have been Canadian energy stocks. These companies have proven that we need them no matter what. It allows us to feel safe with our investments, looking forward to growth that’s sustainable.
However, this has changed over the last few years and even the last decade. Energy stocks in the oil and gas industry are not as strong as they once were. With oil prices remaining volatile and a focus on renewable energy and clean energy sources, oil and gas will likely fall out of use.
That’s why I’ll instead recommend two Canadian energy stocks to buy now for huge long-term returns.
Hydro One
Utility companies are some of the best buys, with some of the longest histories for those seeking long-term returns. These companies have created a massive amount of revenue over the years, showing that no matter what, we need utilities. They’re essential to our everyday lives and will continue to be so in the foreseeable future.
What’s more, many utility companies are still powered by oil and gas but have been entering the renewable energy field as well. These companies have a history here, with long-term contracts with many of these oil and gas producers. However, there is one that’s just starting out on the market that could provide far more stability in the future.
Hydro One (TSX: H) is a strong utility stock that’s just been on the market for a few years. The utility company provides hydropower to Ontario, with the province of Ontario holding a major stake in the operation. It’s a solid choice as it’s already in the renewable energy sector, so there won’t be any growing pains as we transition to clean power.
Meanwhile, there are a lot of current benefits to the stock. Hydro stock trades at 21.34 times earnings, so it’s fairly valued. It offers a 3.3% dividend yield as well and has so much room to expand! So, I would certainly consider it for a long-term hold in your portfolio.
Brookfield Renewable
Another strong choice among energy stocks is Brookfield Renewable Partners (TSX: BEP.UN). While you could invest in a specific type of renewable energy asset, investing in diversification is even better. That’s why I like Brookfield Renewable stock.
This company has a long history, decades in fact, of creating long-term contracts across a range of renewable energy sources. Whether it’s partnerships with major uranium producers for nuclear power or simply wind farms, it has a hand in it all.
Yet high inflation and interest rates have hurt the company in the near term. This is why it now presents a steal on the market today. Shares could double in the next year if analysts have anything to say about it. What’s more, even with current price fluctuations causing potential problems, those will go out the window once the economies of the world return to normal.
Meanwhile, you can lock up a 6.3% dividend yield on the market right now. That provides more than enough reason to pick it up today.
