Investing in stocks doesn’t necessarily require a large initial investment. One can start with as little as $500. By focusing on fundamentally strong Canadian companies in sectors like finance, retail, energy, and technology that have often delivered solid growth, one can generate significant returns in the long term.
With this background, here are five Canadian stocks to consider with a $500 investment. These companies provide a blend of stability and growth potential.
goeasy
goeasy (TSX:GSY) stock offers a mix of growth, income, and value. This financial services company provides loans to subprime borrowers. Thanks to its leadership in the subprime lending space and solid credit underwriting capabilities, goeasy has consistently delivered solid financials, which drove its stock and dividend payments.
The firm is poised to gain from its large addressable market, diversified funding sources, and geographical expansion. This will drive its consumer loan portfolio and overall revenue. Further, operating leverage and steady credit performance will drive its earnings, which have grown at an average annualized growth rate, or CAGR, of over 32% in the last five years. goeasy stock is also trading cheap on the valuation front, considering its stellar earnings growth and a current dividend yield of 2.34%.
Loblaw
Shares of Loblaw (TSX:L), Canada’s largest food and pharmacy retailer, could be a valuable addition to your portfolio. With its resilient business model and value-oriented pricing strategy, Loblaw consistently performs well across various market conditions, positioning itself as a dependable stock. What stands out is that this Canadian blue-chip stock has delivered solid capital gains over the past several years and outperformed the broader markets despite operating a low-risk business.
The retailer’s extensive store network, competitive pricing, and diverse product range will boost customer traffic and enhance same-store sales growth. Additionally, the company’s emphasis on expanding its private-label food products and optimizing its retail operations will likely improve profitability and support future dividend payouts.
Aritzia
Investors could also consider investing in Aritzia (TSX:ATZ) stock in the consumer space. This luxury clothing company consistently generates solid sales and earnings, which supports its share price. For instance, its net revenue has increased at a CAGR of 19% in the past nine years. Moreover, its net income grew at a CAGR of 13% during the same period.
Aritzia will likely benefit from the opening of new boutiques. Further, its focus on expanding its omnichannel offerings and increasing brand awareness will likely boost its e-commerce growth. Overall, Aritzia is well-positioned to deliver double-digit sales growth in the coming years and beat the TSX with its returns.
Well Health
WELL Health Technologies (TSX:WELL) stock presents a compelling investment opportunity within the technology sector. This digital healthcare provider is growing rapidly while its stock is still trading cheaply, providing a good buying opportunity near the current levels. The company is experiencing increased patient visits across its omnichannel platforms, which bodes well for future revenue growth. Moreover, WELL Health’s focus on acquisitions will further boost its growth rate.
While WELL Health is focusing on expanding its predictable revenue base, it is cutting costs, which positions it well to deliver profitable growth in the future. The company is also strengthening its foothold in AI-driven preventative care, which will likely enhance its growth prospects.
Canadian Natural Resources
Canadian Natural Resources (TSX:CNQ) stock could be a valuable addition for investors looking for solid growth and income. This oil and gas company generates solid earnings and cash flows, driving its share price and dividend payments.
Notably, shares of this energy company have grown at an impressive CAGR of nearly 31% in the last five years, delivering capital gains of over 284%. Further, it raised its dividends for 24 years at a CAGR of 21%.
Its high-value reserve, long-life asset base, and low maintenance capital requirements position it well to capitalize on energy demand and grow its earnings and cash flows. Additionally, the energy company’s strong balance sheet supports its growth initiatives.
