Here Are My Top 4 TSX Stocks to Buy Right Now

Invest in quality TSX stocks such as Shopify to benefit from outsized gains in the upcoming decade.

| More on:
data analyze research

Image source: Getty Images

The best way to gain exposure to equity markets is to invest in low-cost passive funds that track indices such as the S&P 500. In the last six decades, the S&P 500 index has returned more than 10% annually after adjusting for dividend reinvestments. So, it makes sense for investors to hold at least 80% of their equity portfolio in these index funds. However, investing in individual stocks can help you beat the market and generate outsized gains. Here are four top TSX stocks to buy right now if you want to beat the broader markets over time.

Shopify stock

Among the fastest-growing TSX companies, Shopify (TSX:SHOP) has already returned 2,680% to shareholders since its IPO (initial public offering) in 2015. Despite these monstrous gains, shares of the e-commerce giant trade 60% below all-time highs, allowing you to buy the dip.

Investors are worried about Shopify’s deceleration in sales amid a challenging macro environment. However, the tech company is forecast to increase sales by 21% to US$8.54 billion in 2024 and by 20% to US$10.3 billion in 2025. Moreover, its adjusted earnings per share is forecast to rise to US$6 by 2028. So, if SHOP stock is priced at 30 times forward earnings, your investment might almost triple in the next four years.

Enbridge stock

A TSX giant that offers you a tasty dividend yield of more than 7%, Enbridge (TSX:ENB) is a diversified energy infrastructure company. Despite the cyclicality surrounding energy stocks, Enbridge has raised its dividends by 10% annually on average since 1995. Moreover, it aims to maintain a dividend-payout ratio of less than 70%, providing it with the flexibility to reinvest in growth projects, lower balance sheet debt, and target accretive acquisitions, all of which should drive future cash flows and dividends higher.

Enbridge continues to remain a top TSX stock in June 2024 and should help you deliver steady returns in the upcoming decade.

Brookfield Renewable Partners stock

Another TSX stock with an attractive yield is Brookfield Renewable Partners (TSX:BEP.UN). The clean energy heavyweight owns several clean energy assets in verticals such as hydro, solar, and wind. In the first quarter (Q1) of 2024, Brookfield increased sales by 12% year over year to US$1.49 billion, US$60 million higher than consensus estimates. Its funds from operations of US$0.45 per share rose 8% and beat estimates of US$0.42 per share.

Despite a sluggish global economy, Brookfield Renewable aims to increase its FFO per share by 10% in 2024. In the medium term, it targets growing dividends between 5% and 9% annually.

GFL Environmental stock

The final TSX stock on my list is GFL Environmental (TSX:GFL) a company part of a recession-resistant sector. Valued at $19 billion by market cap, GFL Environmental transports, manages, and recycles solid and liquid waste while providing soil-remediation services.

GFL continues to deploy growth capital across various initiatives that should generate significant returns on invested capital going forward. In Q1 of 2024, it allocated US$62 million to incremental growth investments related to recycling and RNG (renewable natural gas) infrastructure.

It aims to deploy between US$250 million and US$300 million into these investments in 2024, enabling GFL to increase adjusted earnings before interest, tax, depreciation, and amortization between US$80 million and US$100 million annually.

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 Aditya Raghunath has positions in Brookfield Renewable Partners and Enbridge. The Motley Fool has positions in and recommends Shopify. The Motley Fool recommends Brookfield Renewable Partners and Enbridge. The Motley Fool has a disclosure policy.

More on Dividend Stocks

grow dividends
Dividend Stocks

3 Canadian Stocks With a Real Chance of Doubling Your TFSA’s Value

Three outperforming Canadian stocks can help TFSA investors double their account balances.

Read more »

Hand writing Time for Action concept with red marker on transparent wipe board.
Dividend Stocks

3 No-Brainer Stocks I’d Buy Right Now Without Hesitation

At any given time, the market may have certain stocks that offer a powerful combination of reliability, potential, valuation, etc.,…

Read more »

money cash dividends
Dividend Stocks

This 8.39% Dividend Stock Can Pay $100 Cash Every Month

Consider investing in this monthly dividend stock at current levels to lock in high-yielding monthly distributions to create a good…

Read more »

TFSA (Tax free savings account) acronym on wooden cubes on the background of stacks of coins
Dividend Stocks

Here’s the Average TFSA Balance in 2024

The Bank of Montreal (TSX:BMO) says that the average TFSA balance is $41,510, far below the maximum.

Read more »

A glass jar resting on its side with Canadian banknotes and change inside.
Dividend Stocks

Investors: Here’s How to Make $1,000 Each Month in Retirement

Here's how you can easily make $1,000 in monthly passive income in retirement in Canada, without taking on too much…

Read more »

man touches brain to show a good idea
Dividend Stocks

3 No-Brainer TSX Stocks I’d Buy Right Now Without Hesitation

Three TSX stocks that continue to overcome massive headwinds and beat the market are no-brainer buys right now.

Read more »

calculate and analyze stock
Dividend Stocks

TFSA Investors: 2 Top TSX Dividend Stocks to Buy on a Dip and Hold Forever

These top TSX dividend stocks now offer attractive yields and big potential capital gains.

Read more »

grow money, wealth build
Dividend Stocks

1 Dividend Stock to Buy for Growth and Stay for a 5.5% Yield

This dividend stock has been rising higher, but more could certainly be on the way. Now is the time to…

Read more »