It’s the big question on the minds of many new TFSA (Tax-Free Savings Account) investors at any given time: what’s the best investment to make in today’s climate?
Indeed, Trump tariff turmoil paved the way for a rather treacherous first half of the year. But with things settling down ahead of summer, investors may have the opportunity to take their time as they examine the broad slate of deals to be had today without having to be panicked over the non-stop negative headlines we saw just over two months ago.
Of course, there could be more in the way of negative surprises with tariffs in the second half. However, with China and the U.S. negotiating, it may be unwise to rule out positive surprises as well. In this piece, we’ll check out a name that I think is more of a deep-value play going into July.
For TFSA investors who are still searching for a name to put their latest TFSA contribution (of $7,000) to work, the following name, I think, could be worth adding to your summer watchlist.
As always, do your own research and analysis before putting a sum as substantial as $7,000 on one stock at any given moment. If you’re a big investor who’s already diversified, the following name may be worth a big bet. However, if you’re a beginner investor, I’d argue that spreading your first $7,000 across a slate of names (or exchange-traded funds) would be best.
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Couche-Tard: A perfect stock to stash in a TFSA
Alimentation Couche-Tard (TSX:ATD) shares stand out as an intriguing pick-up for TFSA investors looking for value, long-term growth, and dividend raises. The convenience retailer has been stuck in the penalty box for about a year now, and I think it’s about to skate out of it sometime soon, especially if we get a resolution with the potential deal to buy 7 & i Holdings (that’s the parent firm of 7-Eleven). Over the past few weeks, we’ve had quite a few updates on the proposed deal.
We’ve heard of a non-disclosure agreement (NDA) being signed as a signal that a deal could be close, as well as news of shareholders’ support to fend off a Couche-Tard takeover. Indeed, things seem to be changing by the month. I have no idea if a deal’s still likely at this juncture. Personally, I think it’s best to trust the firm’s managers as they take their time to make their move. Whichever move it’ll be, it’s one I, as a shareholder, am supportive of.
In any case, I think ATD stock is too cheap to ignore, as too much focus has been placed on the proposed deal, with a bit less attention given to the actual growth opportunity at hand.
If Couche-Tard can’t have its way with 7 & i Holdings’s managers, the company has more than enough cash to take advantage of all sorts of deals. Indeed, the robust balance sheet leaves Couche’s value-minded managers in a strong position as they aim to secure some attractive deals to fuel that impressive merger and acquisition-driven long-term growth engine.
With a management team that’s not afraid to go the extra mile on due diligence, I’d be inclined to buy the stock after any period of seasonal weakness. As the stock recovers from a brief drop into a bear market (a more than 21% fall from peak to trough), I think it could be time to start doing some buying. It’s a TFSA mainstay, in my opinion, and it’s likely headed higher as the 7 & i saga (hopefully) nears its end in the second half of 2025.
