3 Best Canadian Stocks to Protect Your Retirement
One of the best ways to secure your retirement is by investing in income stocks. However, the volatility associated with the market is a concern as it could erode capital. However, investors can reduce this risk by investing in fundamentally strong companies with solid dividend payouts and growth histories. In addition, one needs to diversify their portfolio to reduce future disappointment and earn a steady income.With this background, I will discuss three Canadian dividend stocks that are great sources of income. These Canadian stocks are less volatile, have a growing earnings base, and have a solid dividend payout and growth history. Let's dive into stocks
Toronto-Dominion Bank
The best Canadian bank stocks can be a valuable addition to your portfolio to generate reliable income and protect your retirement. Among the big bank stocks to consider investing in is Toronto-Dominion Bank (TSX:TD). This financial services company has been paying dividends for over 166 years. Impressively, it has grown at a CAGR (compound annual growth rate) of about 11% over the past 25 years. Toronto-Dominion Bank's ability to pay and grow its dividend at a solid pace and conservative payout ratio of 40-50% supports my bullish outlook.
The firm is poised to deliver solid earnings, support its share price and increase payouts in the coming years. Its diversified revenue streams, expanding loan portfolio and strong balance sheet will support its top-line growth. At the same time, stable credit performance and efficiency savings dampen its profits. In addition, its incremental acquisitions will help expand its business, accelerate its growth and bolster its finances. Retirees can earn a worry-free return of 4.5% (based on the August 10 closing price of $85.85) by investing in Toronto Dominion Bank shares near current levels.
Fortis (TSX:FTS) is a must-have stock to earn steady income and secure your retirement thanks to its stellar history of dividend growth (49 consecutive years) and low-risk business. The company operates a regulated electricity business and generates predictable and growing cash flows. Its ability to consistently expand its rate base drives its profits and enables it to increase shareholder returns.
It operates 10 regulated utilities and generates almost all of its income from utility assets, meaning its payout is safe and well covered. The company further expects to grow its interest base at a CAGR of 6.2% through 2027, allowing it to increase its dividend by 4-6% annually over the same period. Fortis' solid dividend history, resilient business model, visibility of future dividend growth and decent yield of 4.2% make it an attractive investment
I will quit Enbridge (TSX:ENB). The company transports oil and natural gas. It also owns a small portfolio of renewable energy businesses and operates a regulated natural gas business. Its diversified portfolio, long-term contracts and high utilization rates help it generate solid DCF (distributable cash flow) and support higher payouts. Power purchase agreements, regulated service charge frameworks and low-risk business arrangements also support its finances.
The company has paid a dividend for 68 years. Moreover, it has grown at the same rate for 28 consecutive years. Looking ahead, its investments in conventional and low-carbon energy assets, solid secured capital projects and strategic acquisitions will drive its DCF per share and dividend payouts. Meanwhile, it offers a high yield of 7.2%. All in all, its resilient business, solid payout and lucrative yield make Enbridge a solid investment. You'll want to hear this before you consider Enbridge.Our research team just revealed the top 5 stocks for investors to buy in July 2023, and Enbridge was not on the list.
Motley Fool Stock Advisor Canada, an online investment service they've been running for nearly a decade, is beating the TSX by 29 percentage points. And right now, he thinks there are 5 stocks that are better to buy. Foolish contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge and Fortis. The Motley Fool has a disclosure policy.
When it comes to securing your retirement, investing in stable and thriving Canadian stocks can be a powerful strategy. Canada's robust economy, strong financial markets and reputable companies provide ample opportunities for long-term growth and stability. In this article, we explore three of the best Canadian stocks that can help protect your retirement portfolio, provide financial security and peace of mind.
Enbridge Inc. (TSX: ENB) - The energy giant
Enbridge Inc. is a leading energy infrastructure company that operates one of the largest pipeline networks in North America. With a strong presence in the oil and gas sector, Enbridge provides essential services that are an integral part of Canada's energy industry. As the world transitions to cleaner energy sources, Enbridge is strategically positioned to adapt and thrive. Enbridge Resources, Energy Infrastructure, Pipeline, Oil & Gas, Cleaner Energy, Sustainable Growth.
Royal Bank of Canada (TSX: RY) - Financial stability
Royal Bank of Canada (RBC) is one of the largest and most respected financial institutions in the country. It offers a wide range of financial services, including banking, wealth management and investment banking. RBC's strong history, conservative approach and commitment to innovation make it a cornerstone of stability in Canada's financial sector. Royal Bank of Canada Stock, Financial Stability, Diversified Services, Wealth Management, Investment Banking, Conservative Approach.
Shopify Inc. (TSX: SHOP) - a revolution in e-commerce
Shopify has become a global leader in e-commerce solutions, enabling businesses of all sizes to establish and grow their online presence. The e-commerce trend has seen explosive growth, and Shopify continues to play a key role in shaping the digital retail landscape. Its innovative platform and commitment to small businesses make it a compelling long-term growth stock.Shopify Stock, Ecommerce Solutions, Online Presence, Digital Retail, Small Business, Long Term Growth.
Investing in these top Canadian stocks – Enbridge, Royal Bank of Canada and Shopify – can provide a robust foundation to protect your retirement. These companies represent stability, growth potential and adaptability in line with the dynamics of the Canadian economy and global trends. Diversifying your retirement portfolio with these stocks could be a smart move to ensure a financially sound and worry-free retirement. Be sure to consult a financial advisor to tailor your investments to your specific retirement goals and risk tolerance.
.jpg)
0 Comments