Investing in the equity market with a long-term outlook, such as a five-year horizon, can be a solid strategy for building wealth while navigating market volatility. Over time, short-term fluctuations tend to smooth out, allowing investors to benefit from the broader upward trajectory that equities have historically shown. Compared with many other asset classes, stocks have consistently delivered stronger long-term returns, making them an attractive option for those looking to grow their capital and support future financial goals.
Against this backdrop, these two Canadian stocks stand out as compelling choices to buy and hold for the next five years. Both companies are supported by strong fundamentals and solid business prospects, positioning them well to generate meaningful returns for long-term investors.
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Manulife Financial stock
Manulife Financial (TSX: MFC) is a compelling stock for investors who are willing to buy and hold for the next five years. The financial services giant operates across Canada, the U.S., and Asia, offering a broad range of insurance and wealth management products.
Recently, the Manulife stock has pulled back slightly amid rising geopolitical tensions and broader market volatility. However, the company’s underlying business performance remains solid. Manulife delivered strong top-line momentum, with new business Contractual Service Margin (CSM) growing by more than 20% across all its insurance divisions. This performance pushed the overall CSM balance into double-digit growth territory, strengthening the company’s future earnings potential.
While the Global Wealth and Asset Management (Global WAM) segment experienced net outflows during the second half of 2025, the division continued to post healthy margins and growth in core earnings. This highlights the strength and resilience of Manulife’s investment and asset management platform.
Looking ahead, new business CSM is expected to remain strong, supported by increasing sales volumes in individual insurance products. In addition, strategic acquisitions and organic expansion could further strengthen the company’s insurance operations. Contributions from its Global WAM business and rapidly expanding Asia segment should also support earnings momentum.
Besides capital gains, Manulife’s ability to consistently increase its dividend will enhance shareholder value. MFC’s dividend has grown at a compound annual growth rate (CAGR) of approximately 10.2% since 2015.
Overall, Manulife’s diversified operations, strong insurance growth, expanding presence in Asia, higher dividend payments, and share repurchases make it an attractive long-term stock.
Air Canada stock
Air Canada’s (TSX: AC) near-term outlook is challenging, making it difficult to point to major short-term catalysts for the stock. Like most airlines, the company is highly exposed to macroeconomic conditions, and several pressures are converging.
Rising operating expenses, temporary suspension of certain air routes amid the war in the Middle East, and elevated fuel prices, influenced by ongoing geopolitical tensions, are likely to weigh on near-term margins. At the same time, softer demand in the Canada–U.S. transborder travel market has slowed revenue growth.
Despite the challenges, Air Canada is a compelling investment, and its investment case centres on its efforts to optimize operational performance, expand international reach, and the stock’s discounted valuation.
The airline has been actively adding new routes while pursuing a balanced network strategy. The scale of its hub network, the strength of its global franchise, and continued Sixth Freedom traffic (connecting passengers through Canada between international destinations) are important drivers of long-term growth. Increasingly, international markets across the Atlantic, Pacific, and Latin America are contributing a substantial share of the company’s revenue gains.
Air Canada also benefits from solid passenger unit revenue and strong demand for premium travel. Loyalty among corporate and high-value customers, along with contributions from Aeroplan, Air Canada Cargo, and Air Canada Vacations, further diversifies its earnings base.
Looking ahead, 2026 is expected to be a transitional year as the company absorbs cost pressures while taking delivery of a large portion of its new aircraft fleet. Those investments should improve efficiency and position the airline for stronger performance beginning in 2027 and beyond.
