Investing in shares can help you build wealth in the long term, although it comes with inherent risks. Nonetheless, some stocks are considered “no-brainers” due to their fundamentally strong business models, solid financials, and potential for long-term growth. These companies have demonstrated resilience and adaptability in all market conditions, making them ideal choices for long-term investors.
So, if you plan to invest in stocks with $300, here are three no-brainer Canadian stocks to consider.
No-brainer stock #1
Speaking of no-brainer stocks, investors could consider investing in goeasy (TSX:GSY) for its solid financials and long-term growth potential. This financial services company is an industry leader in Canada’s non-prime lending sector. What stands out is that goeasy has consistently grown its revenue and earnings per share (EPS) at a solid double-digit rate, which has driven its share price and dividend distributions.
goeasy’s top line sports a compound annual growth rate (CAGR) of 20% in the last five years. At the same time, its EPS increased at a CAGR of 32.2%. Thanks to its stellar financials, goeasy stock has grown at a CAGR of nearly 34% in the last five years, delivering capital gains of about 332%. Moreover, it enhanced its shareholders’ returns via higher dividend payments during the same time.
The momentum in goeasy’s business is likely to sustain in the coming years, driven by a large addressable market, omnichannel offerings, geographical expansion, and wide product range. These factors will drive goeasy’s loans and overall revenues. Further, the company’s solid credit underwriting capabilities and focus on operating efficiency will likely cushion its earnings and dividend payments.
Despite the uptrend in goeasy stock, it is still trading at the next 12-month (NTM) price-to-earnings multiple of 11.2, which is attractive given its higher EPS growth and a decent yield of 2.3%.
No-brainer stock #2
WELL Health (TSX:WELL) is a leading digital healthcare company and the largest owner-operator of outpatient medical clinics in Canada. The company is growing rapidly and delivering solid financials. Moreover, WELL stock is trading cheap on the valuation front, providing an excellent opportunity for investing.
The momentum in WELL Health’s business will likely continue in 2024 and beyond, driven by higher omnichannel patient visits. Moreover, its focus on accretive acquisitions will likely accelerate its growth. Additionally, WELL Health is optimizing operations to enhance organic growth and profitability. By prioritizing capital-efficient growth opportunities, the company aims to leverage its cash flows to reduce debt and limit share issuance.
In Canada, WELL Health is set to strengthen its market leadership as the nation’s first pan-Canadian clinical network. Further, it has implemented a cost optimization program to enhance operational efficiency and profitability. Furthermore, WELL Health is investing in artificial intelligence (AI) technologies to develop new products that will support its growth.
No-brainer stock #3
Alimentation Couche-Tard (TSX:ATD) stock could be a solid addition to your portfolio. This company operates convenience stores, a defensive business known for its resilience and stability. The firm also engages in fuel retailing and provides electric vehicle (EV) charging.
Couche-Tard has a proven track record of delivering robust earnings and consistently outperforming the broader market. Over the past decade, the company’s adjusted EPS has grown at an impressive CAGR of 15.2%. This strong earnings growth has enabled the company to increase its dividends at a CAGR of 25.6% during the same period. Couche-Tard stock has grown at a CAGR of 16.6% over the last five years, translating into an overall capital gain of more than 115%.
Couche-Tard’s extensive network of stores, the expansion of its private label products, and operating leverage will likely drive its financials. Furthermore, the company’s solid balance sheet and ability to acquire and integrate companies will accelerate its growth rate and drive its share price and dividends.
