Beginner investors wondering where to invest their TFSA (Tax-Free Savings Account) contributions may wish to check out some of the top Canadian value plays as the TSX Index looks to come in a bit after briefly touching highs not seen in a few years. Undoubtedly, the loonie has been weakening quite a bit of late, especially following the hotter-than-expected U.S. consumer price index (CPI) numbers, which may derail any hopes of a June rate cut from the U.S. Federal Reserve.
Either way, many pundits seem to think Canada is closer to cutting rates than the United States. And if that ends up being the case, the Canadian dollar could easily fall below US$0.72 over the near term and perhaps closer to US$0.70 over the medium term. In any case, there are a lot of great opportunities on this side of the border as the market waters get a bit rockier over the second quarter.
In this piece, we’ll check out one of the best Canadian growth superstar stocks that I think are great pickups for the next seven years at a minimum. Undoubtedly, seven years is a long time to commit to holding a stock. However, if you have such a lengthy timeframe, I’d argue that it’s worth stashing some of the “growthy” (but still low-cost) stocks in your TFSA fund.
Indeed, young investors have time on their side and can afford to grapple with the many corrections and occasional bear markets that an investor is sure to encounter along the way. Indeed, there are no guarantees in the equity markets, perhaps with the exception of volatility and great uncertainty.
Restaurant Brands International
Restaurant Brands International (TSX:QSR) is a Canadian firm behind powerful fast-food brands (most notably Tim Hortons and Burger King). With a company that’s come to the realization that it needs to invest to grow (and outdo industry combatants), investors may have more to love about the firm as it looks to make the next five (or seven) years more profitable than the past five. The way I see it, QSR’s managers are putting their foot a tad more heavily on the gas pedal.
The stock has gained a mere 7.7% in the past five years, not including dividends, which is quite underwhelming. That said, I believe the path ahead looks a heck of a lot brighter now that the firm has stronger talent and the ambition to spend to gain ground over rivals in various corners of the global fast-food scene. With a nice 3.23% dividend yield and a modest 18.92 times trailing price-to-earnings ratio, QSR seems to be a great value and growth play together.
With shares recently correcting more than 11%, I’d not be afraid to add to a TFSA position right here. Why venture south of the border for dirt-cheap growers when we have a terrific growth firm in QSR right here?
Bottom line
Indeed, growth may have been lacklustre in the recent past, but I do expect a re-acceleration of sales growth down the road as the firm’s efforts finally start to pay off. Personally, I’d look for the high single-digits or low double-digits sales growth target as QSR gets past macro headwinds weighing on the broader restaurant industry.
