Retirees: Set it and Forget it With 3 Long-Term Growth Gems

These three growth gems have proven for decades now why they belong in every portfolio, but especially for retirees.

Amy Legate-Wolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote: “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published July 24, 2024 11:45 am EDT

| More on: DOLMFCWCN

Retirement planning often focuses on creating a diversified portfolio that balances income generation with long-term growth. Yet, that can be a lot to ask for retirees looking for stability and potential capital appreciation. Today, we’ve collected a few for you. So, let’s get into three long-term growth gems that fit the “set it and forget it” philosophy.

Retirees sip their morning coffee outside. — Source: Getty Images

1. Waste Connections

Waste Connections (TSX:WCN) is a premier solid waste services company in North America, renowned for its resilient business model and consistent financial performance. In the first quarter of 2024, Waste Connections reported a revenue increase of 9.1% year over year, reaching $2.073 billion. The company’s net income rose by 14.8%, highlighting its operational efficiency and successful integration of recent acquisitions.

The company’s strategy of continuous acquisitions has added over $375 million in annualized revenue, demonstrating its growth potential. With adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) margin improvement from 29.8% to 31.4%, Waste Connections showcases excellent cost management and a strong financial outlook.

Now, why should retirees invest? There are several reasons. Essential waste management services provide a reliable revenue stream. Strategic acquisitions and market expansion offer significant growth opportunities. Finally, Improved margins and cost management enhance profitability. Add in a dividend yield of 0.61%, and it’s a clear winner.

2. Dollarama

Dollarama (TSX:DOL), a leading Canadian discount retailer, has shown robust financial performance, making it a strong candidate for long-term investment. In fiscal 2024, Dollarama achieved a revenue of $5.87 billion, a 16.12% increase from the previous year. The company’s earnings also grew by 26.01%, driven by an increase in store count and higher comparable store sales.

The retailer’s expansion into Latin America through Dollarcity further bolsters its growth prospects. With a strong performance in the first quarter (Q1) of 2024, including earnings per share (EPS) of $0.77 and revenues matching analysts’ expectations, Dollarama is well-positioned for continued success.

Retirees will love the company’s strong revenue and earnings growth track record. Plus, expansion into Latin America offers new growth avenues. Finally, the discount retail model performs well even during economic downturns. And Dollarama stock just bumped its dividend by 30%; it is now at a 0.28% yield.

3. Manulife Financial Corporation

Manulife Financial (TSX:MFC), a leading international financial services group, provides a diverse range of insurance and investment solutions. In Q1 2024, Manulife reported an EPS of $0.94, beating the consensus estimate of $0.90. The company’s revenue for the quarter was $12.80 billion, surpassing the expected $12.13 billion as well.

Manulife’s ongoing digital transformation and strategic global expansion, including issuing $500 million subordinated notes, position it for future growth. Analysts project continued earnings growth, with an EPS estimate of $3.63 for 2024, rising to $4.04 by 2025.

Again, retirees will love it for several reasons. Manulife stock offers consistent earnings and revenue growth. It also provides strategic initiatives, and its global footprint enhances growth potential. And, of course, reliable dividend payments provide steady income. It is currently at a yield of 4.44%.

Bottom line

For retirees looking for long-term growth investments, Waste Connections, Dollarama, and Manulife Financial offer compelling opportunities. These companies provide stable revenue streams, strong growth potential, and operational efficiency, making them ideal candidates for a “set it and forget it” investment strategy.