3 Stocks to Buy Now That Could Help You Retire a Millionaire

These three Canadian stocks are highly reliable and have tremendous long-term growth potential, making them some of the best to buy now.

| More on:
Couple relaxing on a beach in front of a sunset

Image source: Getty Images.

It’s no secret that saving your capital to buy stocks is essential to building your nest egg for retirement and achieving millionaire status. However, when it comes to investing, there are certain strategies to employ and ones to avoid in order to maximize the growth of your capital and gain as much wealth as possible.

For example, many investors, especially those who start young, are drawn to higher-risk investments such as meme stocks. Although it’s true that young investors have a longer investing horizon and can generally take on more risk, certain high-risk companies, such as many meme stocks, should always be avoided.

When it comes to long-term investing and reaching millionaire status, the power of compounding will be your best friend. What that means, though, is that as important as it is to maximize the gains you make investing in stocks, it’s even more important to minimize the losses in your portfolio.

For example, if you invest for five years and earn returns of 11% in the first year, 14% in the second year, and 10%, 12% and 9% in the third, fourth and fifth years, respectively, you would have earned a total return of 69.9% in just those five years, or a compounded annual growth rate (CAGR) of 11.2%.

However, if you buy riskier stocks and your returns are 18%, 15%, 21%, -25% and 19% in each of the five years, you would only have a total return of 46.6%, or a CAGR of 7.9%.

Therefore, even though you had higher returns in four of the five years, losing money in just one year can set you back significantly, showing why it’s essential to pick the highest quality stocks to invest in for the long haul.

Three of the best Canadian stocks to buy now

Since it’s crucial to avoid losing money on our investments, picking the highest-quality stocks that you can have confidence in owning for the long haul is paramount.

Therefore, if you’re looking for some of the best Canadian stocks to buy now, I’d recommend investments such as Alimentation Couche-Tard (TSX:ATD), Thomson Reuters (TSX:TRI), and Canadian Apartment Properties REIT (TSX:CAR.UN).

Each of these stocks has high-quality business models that allow them to grow consistently over the long haul while remaining robust in times of economic turmoil.

A Growing Retail Chain

For example, Alimentation Couche-Tard owns gas stations and convenience stores in countries all over the world. These are highly defensive businesses that generally have sticky demand regardless of whether the economy is growing at a healthy pace.

Additionally, Couche-Tard’s extensive network of stores allows it to achieve cost efficiencies, often resulting in higher margins compared to those of smaller competitors. This scale allows for continued investment in growth, both organically and through acquisitions.

Over the last 10 years, Couche-Tard has earned investors a CAGR of 18.9%, showing why it’s one of the best stocks to buy now and hold for years.

A Global Information Empire

Thomson Reuters is another high-quality business with a truly impressive record of consistency. Not only does it have a diverse portfolio of operations across various sectors, including legal, media, tax, and accounting, but as a leading global news and information service provider, Thomson Reuters has established a strong brand reputation.

Furthermore, nearly 90% of its revenue comes from subscription services, which gives it a tonne of predictable and stable recurring sales and leads to consistent free cash flow generation.

In fact, over the last decade, it has performed even better than Couche-Tard, earning investors a CAGR of 21.2%, showing why it’s also one of the best Canadian stocks to buy now.

A Highly Diversified REIT

Finally, real estate is another industry where you can find many high-quality and reliable stocks, especially in residential real estate, given its defensive nature.

And with Canadian Apartment Properties REIT (CAPREIT) being the largest and most diversified residential REIT in Canada, it’s no surprise that it’s one of the top stocks to buy now.

CAPREIT constantly invests in upgrading its existing properties or acquiring new assets to grow operations and its cash flow.

And while it hasn’t grown as much as Couche-Tard or Thomson Reuters, with CAPREIT earning investors a CAGR of 11.2% over the last decade, it’s certainly one of the best and most consistent Canadian stocks to buy now and have confidence in owning for years to come.

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 Daniel Da Costa has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alimentation Couche-Tard. The Motley Fool has a disclosure policy.

More on Investing

Solar panels and windmills
Energy Stocks

How Brookfield Renewable Stock Gained 40% in a Month

Brookfield Renewable stock (TSX:BEP.UN) surged in share price from a landmark deal and strong earnings, leading to a 40% jump.

Read more »

money cash dividends
Dividend Stocks

2 Under-$10 Dividend Stocks I’d Buy Right Now

Here's why low-cost dividend stocks such as Decisive Dividend should be part of your shopping list in 2024.

Read more »

Canadian Dollars
Dividend Stocks

5 Stocks You Can Confidently Invest $500 in Right Now

These five stocks are all some of the top businesses in Canada, making them stocks you can buy confidently in…

Read more »

A worker drinks out of a mug in an office.
Dividend Stocks

Worry-Free Dividends: 3 Stocks for Canadian Investors

These three Canadian stocks can help you earn worry-free dividends irrespective of market conditions.

Read more »

movies, theatre, popcorn
Investing

Cineplex Stock Looks Like a Steal at $8 and Change

Cineplex (TSX:CGX) stock is starting to look like a great deal as it looks to add to its recent swing…

Read more »

Woman has an idea
Dividend Stocks

The Smartest TSX Dividend Stocks to Buy With $1,000 Right Now

Here's why blue-chip TSX dividend stocks such as BAM and BMO should be a part of your shopping list in…

Read more »

Investing

The Top 5 Movers on the TSX in May

If you're looking for the best of the best, these five have been the top performers in May of this…

Read more »

stock data
Dividend Stocks

TFSA Pension: 1 Great Canadian Dividend Stock to Own for Growing Passive Income

This TSX dividend stock is down 35% from the 2022 high. Is it finally oversold?

Read more »