The Smartest Canadian Stock to Buy With $3,000 Right Now

Alimentation Couche-Tard Inc (TSX:ATD) is a good TSX stock.

If you’re looking to invest a relatively small sum of money like $3,000, you need to make sure you get the most for your dollars. A $3,000 investment could grow into something substantial if allowed to compound over the long term. On the other hand, such a sum will turn into next to nothing if invested poorly. It’s always a good idea to start with index funds, because they offer both low risk and decent returns. If you’re looking to invest a little more aggressively than that, read on, because I am about to reveal one of the best stocks to buy with $3,000 in 2025.

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Alimentation Couche-Tard

Alimentation Couche-Tard Inc (TSX: ATD) is a Canadian gas station/convenience store company best known for the nationwide Circle-K Chain and the Quebec-based Couche-Tard chain. It also operates gas stations in the U.S. and Europe.

What does ATD have going for it that makes it better than the average gas station company?

First, unlike many of the energy companies that operate gas stations, ATD does not pay a high percentage of its earnings out as dividends. That leaves it with a lot of money to re-invest in growth, usually without an extreme amount of debt. The company will be taking out considerable debt if it moves ahead with its 7/11 buyout – more on that in a few paragraphs. In general, though, ATD does not have an overly high debt burden.

Another advantage ATD has is its fuel sales business. Quite simply, this segment earns money for selling oil companies’ refined products at gas stations. Unlike the oil companies themselves, ATD does not risk turning unprofitable in oil bear markets. So it’s a comparatively safe way to bet on fuel prices.

Tariff-proof business

One big advantage that ATD has in 2025 is the fact that it’s a relatively tariff-proof business. Unlike crude oil E&Ps, ATD does not export oil to the U.S. – a business activity that incurs a 10% Trump tariff. Instead it makes money selling gasoline and diesel fuel that is largely sourced within Canada (though occasionally through U.S. companies). This makes it a pretty tariff-resistant company.

A modest valuation

Another thing that Alimentation Couche-Tard has going for it is a pretty modest valuation. The company put out some weak earnings releases last year, and then it announced a 7/11 takeover bid for $40 billion. Both the earnings releases and the takeover attempt were taken poorly by investors, resulting in ATD stock being down from its all-time highs. So now, the stock trades at 18.8 times earnings, 0.63 times sales, and 3.3 times book. This is cheaper than the Canadian markets as a whole.

About the 7/11 deal

ATD’s 7/11 deal has been widely criticized by investors. The company’s bid puts a steep price tag on 7/11 and will entail a massive amount of borrowing. I think the 7/11 deal is probably not a good idea for ATD, but the Japanese government looks unlikely to approve it anyway. So, I don’t consider the 7/11 deal attempt a major negative for ATD shareholders.

Foolish takeaway

Alimentation Couche-Tard has definitely had a rough few years, but it’s still a solid company. I’d be comfortable owning its shares today.

Fool contributor Andrew Button has no position in the stocks mentioned. The Motley Fool has positions in and recommends Alimentation Couche-Tard. The Motley Fool has a disclosure policy.

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