Apart from the tax benefits of investing in a TFSA, one of the often-dismissed advantages of the TFSA is to use it as a buy-and-forget tool to build your portfolio. And as luck would have it, there’s no shortage of great Canadian stocks to buy and hold forever right now.
Here’s a trio of Canadian stocks that should be core holdings for any investor.
Starting with a crazy long-term pick
Some of the best Canadian stocks to buy and hold forever are those which you can buy and truly forget about for a decade or more.
And that’s one of the key reasons why we’re starting with Fortis (TSX: FTS). For those unfamiliar with the company, Fortis is a large utility company with a presence across Canada, the U.S., and the Caribbean.
Utilities like Fortis provide a necessary service and in return generate a stable revenue stream. That revenue stream is backed by long-term regulated contracts, which often span decades in duration. It also means that Fortis can reliably invest in growth and pay out a generous dividend.
That fact alone makes Fortis one of the most defensive picks on the market. Speaking of dividends, Fortis currently pays out a quarterly dividend that carries an impressive 4.4% yield.
But the best part about that dividend is Fortis’ established cadence of providing annual upticks. The company has provided a whopping 50 consecutive annual increases to that dividend and plans to continue that tradition.
Sprinkle in some dividend love
While utilities like Fortis are superb long-term picks, there’s another equally as appealing defensive option to consider, and that’s Canada’s telecoms.
And more specifically, I’m looking at Telus (TSX: T). Telus offers subscription-based services to customers across the country. That includes wireless, TV, Internet, and wireline services.
Both the internet and wireless segments in particular have grown in importance over the past few years, and this has increased the defensive appeal of Telus.
Despite that appeal, over the trailing 12-month period, Telus’ stock price has dropped nearly 20%. That discount is largely attributed to rising interest rates, which forced Telus into some fiscal tightening. As rates begin to drop (the first rate cut already happened), expect Telus’ stock to begin to recover.
All this means is that for those prospective investors looking for Canadian stocks to buy and hold, Telus trades at a steep discount now.
Even better, Telus’ already appetizing dividend has swelled to an insane 7.6%. And like Fortis, Telus has an established cadence of annual or better increases that goes back two decades.
Bank on this stock growing your portfolio
Finally, let’s take a moment to talk about Canadian Imperial Bank of Commerce (TSX: CM). CIBC is one of the smaller of Canada’s big banks. Like its larger peers, CIBC boasts an established domestic segment that generates the bulk of its revenue. The bank also has an international presence that includes operations in the U.S. market.
CIBC also has a very juicy quarterly dividend. As of the time of writing, CIBC currently offers a yield of 5.4% with a history of annual increases going back years. CIBC is up nearly 4% year-to-date.
Investors looking for Canadian stocks to buy and hold can take solace in the stability and reliability of the big bank stocks. CIBC in particular has historically emerged from slowdowns in a stronger growth position.
In other words, investors who want an investment that can provide growth and income will not be disappointed with CIBC.
The Canadian stocks you can buy and hold
All three of the stocks mentioned above are stellar long-term picks. In my opinion, one or all of these can provide years of growth and income-earning potential.
Buy them, hold them, and watch them grow in your well-diversified TFSA.
