When it comes to investing your money to build wealth, save for retirement, or achieve financial freedom, there’s no question that investing for the long haul and finding the top Canadian stocks to buy is the best strategy.
It’s true that you might find a meme stock that skyrockets in a day, but those are uncommon. More importantly, they are high-stakes gambles. They’re not the kind of growth you can count on.
Real success in investing comes from playing the long game. Predicting short-term market moves is tricky, but the economy generally trends upward over time. That’s why it’s essential to pick companies with solid potential for growth and hold onto them. Patience, research, and a focus on quality are your keys to long-term investment success.
Another reason investing for the long haul is ideal is that it allows you to mitigate short-term risk. When it comes to investing or even just assessing the economy, it can be tough to predict its performance in the near term. Over the longer term, though, the economy is always growing, and the highest-quality stocks will continue to find ways to expand their operations.
So, it’s essential to be patient, do extensive research, and identify which stocks are the highest-quality businesses on the market and which have the most long-term potential.
With that in mind, if you’ve got some cash lying around that you’re looking to put to work today, here are two of the best Canadian stocks to buy now and hold for years.
One of the top Canadian telecom stocks to buy and hold
While there are plenty of stocks on the TSX to research and consider, there’s no question that one of the top Canadian stocks to buy now and hold is Telus (TSX:T), the massive $33 billion telecom stock.
Telecom stocks are ideal long-term investments for several reasons. First, the industry has become increasingly essential, especially as technology consistently improves and we continue to rely on the internet more and more each day.
In addition, the industry has massive barriers to entry, giving Telus and its peers a significant competitive advantage. Another main reason is that stocks like Telus are constantly earning massive amounts of cash flow.
Telcom stocks install fibre in the ground and towers across the country, which then earns them revenue for years. These are called long-life assets because they require little maintenance once built but can help Telus generate significant revenue for years. This makes Telus a cash cow and shows why it’s one of the top Canadian stocks to buy and hold.
Furthermore, with most of the fibre that Telus had planned to install now in the ground, the stock won’t need to spend as much on capital expenditures in order to stay competitive with its rivals. That means more cash flow will be available to fund the dividend, making an already appealing 6.7% dividend stock even more of a compelling investment.
So, if you have cash to invest today, Telus is certainly one of the top Canadian stocks to buy and hold for the long haul.
A top TSX energy stock
In addition to Telus, another high-quality stock that you can confidently own for the long haul is Freehold Royalties (TSX:FRU).
Freehold is an energy stock that doesn’t produce oil and gas itself but instead acquires land that it lets other companies use to produce oil and gas — in exchange for a royalty.
This is a lower-risk business model because Freehold doesn’t have to worry about spending tonnes of capex in order to produce oil and gas. Instead, it simply acquires more land over time and collects royalties from the companies that do the actual production, creating a steady stream of income.
Furthermore, the stock is well diversified owning land both north and south of the border. This is crucial because often, a decline in production in one country can be offset by an increase in production in the other.
Not to mention Freehold’s current dividend, which has a yield of roughly 7.5%, has an estimated payout ratio for 2024 of just 64%. So, if you’re looking for top Canadian stocks to buy and hold for the long haul, Freehold is certainly a top choice.
