After a tough end to the year, the Canadian stock market kicked off 2025 on the right foot. The S&P/TSX Composite Index returned more than 2% in January. But as we’re nearing the end of February now, we’ve yet to see the index return to the highs it set last month.
It’s no surprise to see high levels of volatility in the stock market lately. There’s no shortage of question marks around the macro environment right now, which is creating lots of uncertainty for both individual investors and the stock market as a whole.
Investing for the long term
Putting money to work when the market is on a decline is easier said than done. It can be hard to accept that you’ll likely not be able to time the market’s bottom. But over the long term, even if you’ve miss-timed the bottom by months, if you’re investing in top-quality companies, you’ll be just fine.
With that in mind, I’ve put together a well-rounded basket of three top Canadian stocks.
If you’re looking to put some cash to work today, these three companies should be on your radar.
Constellation Software
From a price perspective, Constellation Software (TSX:CSU) is amongst the most expensive stocks you’ll find on the TSX. That being said, tech stock owns a track record of market-beating returns that cannot be matched by many.
Shares are up 30% over the past 12 months and close to 250% over the past five years.
Growth has understandably slowed in recent years as the business is now valued at a market cap of $100 billion. Even so, I can’t think of any reasons you’d want to doubt Constellation Software’s ability to continue delivering market-beating returns for years to come.
Brookfield Infrastructure Partners
Owning a utility stock like Brookfield Infrastructure Partners (TSX:BIP.UN) won’t be anywhere near as exciting as owning a company like Constellation Software. Utility companies can, however, provide an investor with defensiveness and a steady stream of passive income.
Due to the stock’s defensive nature, Brookfield Infrastructure Partners can help minimize volatility in an investment portfolio. That can be especially useful for growth investors who might be over-skewing towards high-growth companies like Constellation Software.
At today’s stock price, the company’s dividend is yielding an impressive 5%.
Northland Power
It’s not hard to find a renewable energy stock that’s trading at a discount right now. Aside from passive income, short-term investors might not see much value in the sector. But for those with a long-term time horizon, now could be an excellent time to invest in a beaten-down renewable energy stock.
Northland Power (TSX:NPI) might only be valued at a market cap just shy of $5 billion but it’s a great all-around stock to own in the space. The company boasts a global presence and produces electricity from a wide range of renewable resources.
Excluding dividends, shares are down a whopping 65% from all-time highs, which were last set in early 2021. It is worth noting, though, that the dividend is currently yielding close to 7%.
If you’re bullish on the long-term growth potential of renewable energy, you won’t want to miss out on these discounted prices.
