What should be a top pick for your TFSA (Tax-Free Savings Account) portfolio? Preferably, the most wonderful businesses that you’d be fine with hanging on for the long term. Ideally, it’d also be nice if you had the confidence and conviction in the firm to be more than willing to buy additional shares at a discount in the face of a potential sell-off.
Whenever you see yourself adding to your position on weakness and backing up the truck if shares were to implode, perhaps in the face of a broader stock market sell-off, you might have a great TFSA-worthy stock on your hands. Of course, a great business itself might not be the best buy in the world if you can’t get in at a reasonable price.
That’s why it makes sense to watch a handful of stocks in case one of them so happens to fall into a price range that’d warrant making a big “swing” on your part.
As the great Warren Buffett once put it (I’m paraphrasing here), investing has no called strikes. You don’t need to make moves unless the odds are on your side and you believe there’s a chance that you can not only make a hit, but perhaps hit one right out of the ballpark. In any case, patience is the key when you’re coming up to bat and not swinging wildly at the pitches that are nowhere close to a range which would entail a fair-to-discounted multiple.
In this piece, we’ll look at a trio of reasonably priced stocks that TFSA investors, especially those with longer-term investing horizons, may wish to consider picking up if they’ve got room this December, or in January, once there’s another contribution to make (it looks like it’s going to be another $7,000 for 2026).
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Cameco
First, we have uranium producer Cameco (TSX: CCO), which has been too hot to handle for many over the past year. The stock has some serious long-term momentum behind it, with shares now up more than 840% in the past five years, driven by the enthusiasm for the nuclear power renaissance and the role reactors will play in powering the AI future. Of course, there’s more room for uranium prices to march higher as more reactors come online in the next 10 years.
As one of the top producers, Cameco is on the right side of a secular trend. And while I hate buying stocks after multi-bagger moves, I still think there’s a strong case to own shares in a TFSA for the long run, especially if investors can take advantage of dips. With shares recently down over 16% from recent highs, I think the mature uranium miner is finally worth picking up if you’re not exposed enough to the AI-fuelled nuclear boom.
At nearly 66 times forward price-to-earnings (P/E), the name is mildly expensive, even given the growth potential, at least in my view. However, the latest correction could easily worsen, so be ready to keep buying on the way down if you’re looking to average your cost basis lower! In short, CCO stock looks enticing, but even more so if the latest correction turns into a bearish implosion in excess of 20%.
Nutrien
Nutrien (TSX: NTR) is another miner that doesn’t get as much attention. The agricultural commodity producer is up just 7% in the past two years. And while there has been a bit of consolidation, I still see significant value in the shares at 11.8 times forward P/E.
There’s also a nice 3.8% dividend yield that investors can surely appreciate as they wait for the tides to turn. It’s probably going to be a long while before the next potash and nitrogen boom. But if you’re looking for a steadier source of income, I do like the name now and on any further pullbacks below $80 per share. Nutrien is a great miner; it just needs the industry dynamics to shift back in its favour.
