Investing $30,000 in two strong TSX stocks is a smart way to create reliable passive income, especially when alongside other diversified assets. When done with a balanced approach, it combines the power of capital appreciation, dividends, and market stability. Here’s why this strategy is worth your attention and two stocks to go with it.
The stocks
Lundin Mining (TSX:LUN) is a standout in the mining sector, with a strong focus on copper, nickel, and zinc. Copper, in particular, is essential for the renewable energy transition, making Lundin’s position even more promising. The company’s recent earnings show impressive revenue growth of 8.1% year over year for the third quarter (Q3) of 2024, with operating cash flow hitting $1.2 billion over the last 12 months. Its trailing annual dividend yield of 2.18%, coupled with a forward yield of 2.87%, ensures a steady income for investors while benefiting from rising commodity prices.
TFI International (TSX:TFII) is a leader in the logistics and transportation sector and is known for its resilience and innovation. TFII’s revenue grew by 14.3% year over year in Q3 2024, reflecting strong demand for its services across North America. While earnings dipped slightly by 4% due to higher operating costs, the company’s profitability remains robust, with a forward price-to-earnings ratio of just 17.15, indicating value for long-term investors. Its dividend yield of 1.34% may seem modest but is complemented by consistent dividend growth and a low payout ratio of 29.14%, leaving room for future increases.
Easy picks
Pairing these two stocks creates a balanced mix. Lundin Mining thrives in a cyclical, resource-heavy industry, offering the potential for capital appreciation during commodity booms. Meanwhile, TFI International is a stable, service-oriented stock benefiting from e-commerce growth and economic recovery trends, providing resilience during market downturns.
Lundin Mining’s current valuation is attractive, trading at just 1.34 times book value, which is lower than many peers. The company has effectively managed its debt with a current ratio of 1.4, ensuring financial stability. Plus, with increasing global infrastructure projects and electrification, Lundin’s long-term outlook is bright.
TFI International, priced at $195.60 as of writing, remains a growth stock with consistent performance. Its strong institutional ownership at 74.74% reflects confidence in its strategic acquisitions and cost-efficient operations. With a history of leveraging its assets to generate free cash flow ($481.91 million in the last 12 months), TFII has room to reward shareholders while funding growth.
How much you can get
Investing in these stocks aligns with a smart diversification strategy. Commodities like those mined by Lundin offer inflation hedges, while logistics stocks like TFI benefit from long-term e-commerce trends. Together, these reduce portfolio risk and provide stability in a volatile market.
Another key benefit of these stocks is their capacity for dividend reinvestment. Both companies offer consistent payouts that can be reinvested to buy more shares over time, compounding your investment without additional contributions. With Lundin and TFI’s growth trajectory, this reinvestment could accelerate wealth creation. In fact, here is what investors could earn from half that $30,000 investment in each.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | DIVIDEND | TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
| LUN | $13 | 1,154 | $0.36 | $415.44 | quarterly | $15,000 |
| TFII | $197 | 76 | $2.58 | $196.08 | quarterly | $15,000 |
Bottom line
Ultimately, putting $30,000 into LUN and TFII is a calculated way to grow wealth while enjoying the perks of passive income. These stocks offer stability, growth, and dividends, making them a winning duo in your diversified investment portfolio. And this investment could bring in $611.52 in dividend income alone each year!
