The TSX offers several high-quality stocks that are worth holding for decades to create wealth. However, only a select few Canadian stocks consistently deliver steady, reliable gains year after year.
What sets these companies apart are their strong fundamentals and resilient business models. Regardless of market volatility, they have a proven ability to grow both revenue and profit. This consistent performance drives solid capital appreciation, resulting in increasing dividend payouts that enhance overall returns for shareholders.
With this background, here are two TSX stocks to hold for steady gains.
Dollarama stock
Dollarama (TSX:DOL) is a solid stock to generate steady returns. This discount retailer has consistently outpaced the broader market thanks to its recession-resistant business model and low-price strategy.
Dollarama sells a wide range of everyday items and seasonal goods at fixed, low-dollar prices. This value-driven approach keeps demand strong throughout the year. Plus, with new store openings, Dollarama continues to attract more shoppers and boost its financial performance.
Dollarama kicked off its fiscal 2026 on a high note. In the first quarter, sales rose 8.2% year-over-year to $1.5 billion, mainly due to store expansion over the past 12 months. Comparable store sales also climbed 4.9%, fueled by a 3.7% increase in transactions and a 1.2% rise in the average purchase size. Strong demand for everyday essentials and solid seasonal sales contributed significantly to this growth.
Thanks to its consistent performance, Dollarama stock has delivered impressive gains. So far this year, shares are up about 37.3%. Over the past five years, DOL has grown at a compound annual growth rate (CAGR) of 32.5%, resulting in total returns of more than 308%. Additionally, Dollarama has been returning higher cash to its shareholders, increasing its dividend 14 times since 2011.
Looking ahead, Dollarama’s low prices, strong supply chain, and expanding geographical footprint are expected to continue driving earnings and supporting future dividend increases.
In summary, Dollarama is a perfect stock for investors seeking steady returns through capital appreciation and dividend income.
Hydro One stock
Hydro One (TSX:H) is another reliable stock for steady returns. Its regulated electricity transmission and distribution operations remain immune to commodity price swings, making its earnings more predictable.
Thanks to its low-risk earnings and steady financials, Hydro One stock has grown at a CAGR of 17.3% over the last five years, delivering capital gains of 122.6%. Besides outperforming the TSX with its growth, Hydro One also appeals to income-focused investors. The company has raised its dividend at a steady 5% CAGR over the past eight years and currently pays an annualized dividend of $1.33 per share.
Hydro One’s prospects remain solid, supported by a robust balance sheet, strong internally generated cash flows, and an expanding rate base. Its rate base is projected to grow at a 6% CAGR through 2027, which is expected to drive annual earnings growth of 6–8% and continued dividend increases of about 6%.
As long-term trends such as electrification, data centre expansion, and population growth push power demand higher, Hydro One, with its defensive business model, is well-positioned to benefit and deliver steady gains.
