When it comes to buying stocks for 2024, investors have a tonne of excellent choices. However, the uncertainty of both the economy and the market environment certainly does not make stock picking straightforward, whether you are a seasoned investor or a beginner just looking to start out.
However, while these environments can be difficult to invest in, they also serve as great reminders of why we need to find the highest quality stocks to buy and ensure we are buying those stocks for the long haul.
Now, more than ever, owning high-quality stocks is essential, both to protect your capital from higher volatility and to set you up for years of gains down the road.
With that in mind, if you’re a beginner investor looking for some of the top Canadian stocks to buy in 2024, here are two simple-to-understand businesses trading at attractive valuations.
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One of the most defensive stocks in Canada to buy for 2024
When you consider the uncertainty in the stock market as we begin 2024 and the fact that interest rates are already considerably high, one of the best investments beginners can make is in safe, defensive stocks, such as Fortis (TSX: FTS).
Fortis is a massive utility company with operations diversified all across North America. It offers gas and electricity services, and because utilities are highly regulated, as well as essential services, the revenue and profitability that Fortis earned is generally pretty predictable.
That’s one of the main reasons why it’s such a reliable investment and a great stock to buy now, whether you’re just starting out or a seasoned investor.
Furthermore, because Fortis is consistently expanding its operations, and because it’s proven to be resilient in all types of economic conditions, the utility company is also one of the most reliable dividend stocks you can buy.
Not only can you count on the stock for consistent income, but Fortis also has the second-longest consistent dividend-growth streak in Canada, at an unbelievable 50 years. Today, it offers a yield of roughly 4.4%.
Finally, one of the few environments that can negatively impact Fortis is a rising-rate environment. And although the market continues to be uncertain, most investors, analysts and economists would agree that the majority of, if not all, the interest rate hikes in this cycle are now in the rearview.
So, if you’re a beginner investor and looking for top stocks to buy in 2024 and hold for years to come, Fortis is certainly one of the best to consider.
A simple dividend stock to help boost your passive income
In addition to Fortis, another excellent stock and simple business for beginner investors in 2024 is Pizza Pizza Royalty (TSX: PZA).
Pizza Pizza is a simple stock because it collects a royalty on all the sales done at Pizza Pizza and Pizza 73 restaurants across the country.
Investors don’t have to worry about the profitability of each store; instead, they are just focused on the aggregate sales that Pizza Pizza can generate throughout Canada, and now, as it expands into Mexico,
Furthermore, the royalty corporation itself only has a few administrative expenses to pay in addition to interest and taxes. This means that the majority of the royalty revenue that Pizza Pizza stock receives flows right through to the bottom line and is available to be paid back to investors.
The reason the stock is so simple for investors is that it’s easy to track how it’s performing and whether or not its sales are increasing. Typically, as sales increase, because of the minimum expenses that Pizza Pizza stock pays, the dividend is soon increased in response.
For example, since Pizza Pizza had to trim its dividend at the start of the pandemic, the stock has now increased that dividend on eight separate occasions as its sales and profitability have recovered and then surpassed their 2019 highs. Plus, today Pizza Pizza’s yield sits at an impressive 6.3%.
So, if you’re just starting to invest in 2024 and looking for high-quality stocks to buy and hold long term, Pizza Pizza is an excellent choice to boost your passive income.
