I’m going to deviate from my typical focus in most articles, which is on providing investors with the most defensive picks in this current market environment to consider over the long term. One of my picks as a top stock to buy for those looking to put $7,000 to work in the market fits this category. But one is a high growth stock that I think can provide meaningful upside over the long term for those looking at investing in a TFSA.
Both companies are ones I think could outperform, but in different ways. Let’s dive into why these two stocks could make up core portfolio holdings for investors looking to pick stocks right now.
MDA Space
One company I haven’t touched on much, but has one of the best growth profiles in the Canadian stock market, is MDA Space (TSX:MDA).
This company’s stock chart is about as volatile as they come. A spike earlier this year toward the $45 per share level has since been met with stark selling pressure. At around $20 per share at the time of writing, the question many investors have is whether this is a dip worth buying, or representative of a stock to stay far away from.
I think the answer is likely the former, considering the company’s entrenched nature as a leading provider of digital satellite systems, geointelligence, and robotics. For those bullish on the future growth the space industry will provide, MDA Space provides a speculative vehicle to invest in this trend, with reasonable fundamentals and growth potential as more government and private enterprises get into the game.
Over the long term, I think MDA will be a winner. That could mean investors who buy this stock on significant drawdowns may be the ones who come out ahead.
Enbridge
A much, much safer pick, at least on a historical basis, is Enbridge (TSX:ENB).
Shares of the Canadian pipeline giant have been on a slow and steady ascent higher in recent years, as investors look for ways to play a reversion toward the energy independence discussion on our continent.
Energy needs continue to grow, and Enbridge’s massive pipeline network, as well as its natural gas utilities and renewable energy assets, provide a diversified way for investors to gain exposure to a number of high-growth trends. With a dividend yield of around 5.6% and solid cash flow growth over the long term, there’s a dividend and value component to this stock which are worth considering as well.
I think a well-balanced portfolio should consist of stable and consistent companies like Enbridge, as well as some amount of exposure to higher-growth companies like MDA space. These two firms provide the balance I think many investors are looking for and are worth a deeper look for those with portfolio room for a few new positions.
