3 Canadian Stocks You Can Confidently Buy Now and Hold Forever

These Canadian stocks have the potential to deliver stellar capital gains, In addition, investors will likely benefit from higher dividend payouts.

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Stocks have consistently outperformed other investment avenues with their returns in the long term. Therefore, it’s wise to allocate a portion of your savings to equities for creating wealth in the long term.

However, investors should consider shares of fundamentally strong Canadian companies with the potential to deliver durable revenue and earnings growth. This will enable them to generate worry-free capital gains and outperform the broader markets. 

Against this background, let’s look into three Canadian stocks you can confidently buy now and hold forever. 

Dollarama

Speaking of long-term stocks, investors could consider adding Dollarama (TSX:DOL) to their portfolios. The company owns a defensive business that performs well in all economic situations. For instance, its strategy to sell products at low and fixed price points drives traffic to its stores and supports its financials.

Notably, this retailer’s sales and earnings have increased at a CAGR (compound annual growth rate) of 10% and 16%, respectively, since fiscal 2011 (FY11). Thanks to Dollarama’s solid financial performance, its stock has appreciated by over 651% in the past decade, delivering an average annualized return of about 22.3%. At the same time, Dollarama has enhanced its shareholders’ returns through increased dividend payments. 

The company’s value pricing, extensive store network, direct sourcing strategy, and efforts to reduce merchandise costs augur well for future growth. Overall, Dollarama is a top stock for investors looking for capital gains, regular income, and stability in all market conditions. 

goeasy

goeasy (TSX:GSY) is an attractive mid-cap stock to buy now and hold forever. The firm offers lending and leasing services to subprime borrowers. What stands out is that goeasy has consistently grown its revenue and net income at a solid double-digit rate. Thanks to its strong financial performance, goeasy stock has outperformed the broader markets by wide margins and generated enormous capital gains. 

For instance, goeasy’s top and bottom lines have a CAGR of 17.7% and 29.5%, respectively, between 2012 and 2022. Moreover, its sales and earnings have grown at a CAGR of 19.8% and 31.9%, respectively, in the past five years (as of December 31, 2023). It’s worth noting that goeasy stock has grown at a CAGR of 28.5% in the past decade, delivering a return of 1,129%. Meanwhile, it enhanced its shareholders’ value by increasing its dividend every year in the past nine years.

Looking ahead, goeasy’s top line will likely benefit from geographical expansion, diversified funding sources, omnichannel offerings, and a large subprime lending market. Higher sales, stable credit performance, and efficiency improvements will cushion its earnings, drive its share price, and support higher dividend payments. 

Canadian Natural Resources

Canadian Natural Resources (TSX:CNQ) is another valuable stock to buy and hold forever. Shares of this energy giant have consistently outperformed the broader markets over the past several years. Notably, Canadian Natural Resources stock has gained nearly 253% in five years, reflecting a CAGR of 28.6%. Moreover, CNQ is one of the top stocks to earn a worry-free passive income. CNQ has increased its dividend for 24 consecutive years. Meanwhile, its dividend sports a CAGR of 21% during the same period.

The company’s high-value reserves, diversified and long-life assets, low debt-to-adjusted funds flow ratio, focus on cost control, and strong balance sheet provide a solid platform for future growth. Besides capital gains, investors could continue to benefit from Canadian Natural Resources’s focus on distributing higher cash to its shareholders. 

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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Canadian Natural Resources. The Motley Fool has a disclosure policy.

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