With the TSX Index up 21% in 2024, it has been a great year for Canadian stocks. However, if you want to consistently keep that momentum, you need to hold stocks in great businesses.
If you want success beyond just a good year, you want stocks that can consistently deliver for shareholders. Some hallmarks of this are a great mix of products/services, a strong balance sheet, prudent management, and a profitable/cash-generative business model.
If you want some stocks for success, here are three to look at holding for the long term.
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A top TSX trucking stock
TFI International (TSX: TFII) has been a great compounder for shareholders. Its stock is up 375% in the past five years and 619% over the past 10 years.
It is a trucking, logistics, and freight provider in Canada and the United States. Certainly, it is not the most exciting business. However, it has an excellent management team that is focused on smart capital allocation and a low-cost operating model.
TFI has grown by consolidating small and medium-sized transport operations around North America. There has been a freight recession in North America for the past two years. While it has impacted volumes and earnings, it could present attractive acquisition opportunities.
TFI has had some operational problems with its U.S. less-than-truckload division. That has been a drag on results. Yet, even despite the issues, it has been generating a lot of excess cash.
If it can get that business turned around, it could really see earnings start to tick up. Certainly, a normalized freight environment would also help. The good news is that it is probably hitting the trough and there is further upside from this TSX stock from here.
A global real estate giant
Colliers International Group (TSX: CIGI) is another great long-term TSX stock. Its stock is up 120% in the past five years and 259% in the past 10 years.
Colliers is a well-known global commercial real estate broker. That business has been in the dumps, especially as interest rates rapidly rose over the past two years. Fortunately, now that rates are quickly coming down, real estate is starting to trade hands. That business segment should start to hum again soon.
What the market doesn’t recognize is that over 70% of Colliers’s earnings now come from recurring sources. It has become a significant player in the consulting/project management/engineering industry. Likewise, it has a very profitable asset management division.
If you want a well-managed serial acquirer that appears undervalued (despite rising 30% in 2024), Colliers is a solid bet.
An up-and-coming TSX insurance stock
Another TSX stock for the long term is Trisura Group (TSX: TSU). It is the smallest company in this mix, with a market cap of only $1.89 billion. Like the others, it has a good long-term return record. Its stock is up 289% in the past five years and 675% since 2017.
Trisura offers specialty insurance and insurance fronting services in Canada and the United States. The company focuses on very niche products where it can earn high margins and closely manage risk. It earns attractive high-teens returns on equity.
The company had to write down a program last year. This impacted near-term results. However, it has been returning to a growth and profit posture in 2024.
Right now, Trisura is trading at only 13 times forward earnings. If it can hit mid- to high-teens earnings growth next year, this stock could be very cheap today.
