Got $100? 2 Top Canadian Stocks to Buy and Hold

Buy and hold these two Canadian stocks for $100 to generate significant returns in the long term.

| More on:

Stocks can generate higher returns than many other types of investments over the long term. The great thing is that you don’t need a large sum of money upfront to invest in high-quality TSX stocks. Even starting with as little as $100 in fundamentally strong stocks regularly can lead to significant returns over time.

With that backdrop, here are two top Canadian stocks investors can buy and hold for just $100. These companies have well-established businesses and solid growth potential, making them top choices for investors looking to grow their money.

Hydro One

Investors could consider Hydro One (TSX:H) as it offers growth, stability, and income. Unlike other utility companies, Hydro One does not generate power and is not exposed to commodity price volatility. This means it is a pure-play electric power transmission and distribution company that produces stable, low-risk earnings and predictable cash flow.

Hydro One has solid financials, which allow the company to fund its growth initiatives without raising capital from other external sources. Owing to its stellar financials and rate-regulated business, this utility company consistently delivers stable cash flows, offers higher dividend payments, and attractive capital gains.

Hydro One has consistently grown its dividend, supported by higher earnings, regulated cash flows, and rate base growth. The company raised its dividend at a compound annual growth rate (CAGR) of about 5% from 2016 to 2022. Moreover, it increased its dividend by 6% in 2023 and plans to grow it at a similar pace through 2027.

Hydro One projects its rate base to grow by 6% annually through 2027. The company’s $11.8 billion capital plan will support this growth. Thanks to this growth, its earnings per share are forecasted to increase by 5-7% annually.

Hydro One stock has appreciated about 32.6% in one year and grown about 124% in five years. Despite the growth, the stock still has room for upside, driven by its low-risk business model and steady earnings. Further, its solid balance sheet, predictable cash flows, cost reduction initiatives, and ability to deliver both dividends and capital gains make it a top Canadian stock to buy and hold for the long term.

Aritzia

Clothing retailer Aritzia (TSX:ATZ) is another top Canadian stock for long-term investors. The company is known for delivering above-average growth, reflected through its double-digit revenue and adjusted net income growth. Further, it has consistently outperformed the TSX.

For instance, the company’s revenue and net income have grown at a CAGR of 19% and 13% in the last five years, which has driven its shares higher. Aritzia stock has increased over 197% in five years, reflecting a CAGR of 24.3%. Meanwhile, the stock gained over 130% in one year, and this trend will likely continue, owing to the continued growth in its top line and focus on margin expansion.

Aritzia sees its net revenue growing by 15-17% annually through fiscal 2027. Aritzia plans to open eight to 10 new boutiques in the U.S. annually through fiscal 2027 and increase its total retail square footage by up to 60%, likely boosting its revenues. Additionally, Aritzia’s focus on growing its omnichannel offerings and increasing brand awareness will further accelerate its revenue growth rate.

Overall, higher sales and operating efficiency will likely bolster its earnings and support its share price.

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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Aritzia. The Motley Fool has a disclosure policy.

More on Investing

A worker overlooks an oil refinery plant.
Energy Stocks

What to Know About Canadian Energy Stocks for 2025

Today, I'll explore tariffs, pipelines, and profit potential on TSX energy stocks for 2025, and how Suncor stock and two…

Read more »

An investor uses a tablet
Bank Stocks

Better Banking Stock: Royal Bank vs TD Bank?

Royal Bank has outperformed TD in recent years. Will 2025 be different?

Read more »

Canadian Dollars bills
Dividend Stocks

Invest $22,000 in 2 TSX Stocks for $1,279 in Passive Income

Passive income doesn't need to be difficult or costly, and these two stocks offer it up in spades!

Read more »

Piggy bank with word TFSA for tax-free savings accounts.
Dividend Stocks

The Best Canadian Dividend Stocks to Buy and Hold Forever in a TFSA

These Canadian stocks all pay reliable dividends and consistently grow their earnings, making them three of the best to buy…

Read more »

Stocks for Beginners

The Best Stocks to Invest $25,000 in Right Now

Got a bunch of cash to deploy? These four Canadian stocks would make an excellent start for a long-term investment…

Read more »

Dividend Stocks

Got $1,000? 3 REITs to Buy and Hold Forever

Do you want some REITs to buy and hold forever? Here’s a look at a trio of options to consider…

Read more »

data analyze research
Dividend Stocks

2 Stocks I Loaded Up on in 2024 for Long-Term Wealth

A tech giant and a renewable energy giant were strong picks in 2024 and will continue to be strong through…

Read more »

dividend growth for passive income
Dividend Stocks

Need Decades of Passive Income? 2 Stocks to Buy Without Delay

These two dividend stocks offer it all. Stable passive income, with growth opportunities already on the way.

Read more »