5 stocks I want to buy in 2021

5 stocks I want to buy in 2021

I’ve been a DIY investor for over 11 years now, a hybrid investor no less.

That means I own a mix of individual stocks and low-cost ETFs. I’ll provide some links below as to what I own and where later.

Last year, this post got quite a bit of attention on my site. Other DIY investors were curious about what I was buying and why in 2020.

5 stocks I bought more of in 2020

Well, I’m back with a new edition for the top stocks I want to buy in 2021.

Without delay, let’s go!

1. Canadian National Railway (CNR)

Once again, Canadian National Railway (CNR) makes my list.

Like the game Monopoly, there are only a few railroads on the board. To be successful in that game, one strategy is to own all the railroads. The rent for your Monopoly railroads goes something like this: if you own one, the rent on it is $25. If you own two, you get $50 rent from anyone landing on either, if you own three then you get $100, and if you own all four railroads then the rent is tidy $200.

Well, I would argue it’s the same in real life!

With very few players involved at this scale, to transport goods around North America, I figure CN rail is a key stock to own for mostly growth.

CNR map

I’ve owned CNR for years and I intend to buy more inside my RRSP later this year.

CNR January 20, 2021

2. Algonquin Power (AQN)

I’ve been a shareholder of this company for more than a decade now and certainly in hindsight, this has been a great Canadian selection.

I started writing about AQN back in 2013. I’ve been a shareholder since before that time.

My thesis on AQN and other Canadian renewable energy companies is simple – for the sake of our planet, we need to go more green far sooner than later. I’m happy to support that push with my wallet.

Algonquin Power & Utilities Corp. is a growing renewable energy and regulated utility company with assets across North America. This company both acquires and operates green and clean energy assets including hydroelectric, wind, thermal, and solar power facilities, as well as sustainable utility distribution businesses (water, electricity and natural gas).

The renewable energy space has also been good to shareholders and that trend should continue for the foreseeable future. I hope so. We need more of what AQN delivers.

AQN January 20, 2021

3. *RioCan REIT (REI.UN)

*I’ll get to RioCan in a bit…

Last year, I wrote about owning more Brookfield Property Partners (BPY.UN or BPY).

In fact, I did what I said I would – I bought more in 2020.

However, earlier this year, in 2021 shareholders of BPY.UN/BPY got thrown a curveball.

Brookfield Asset Management Inc. (i.e., “Brookfield”) (NYSE: BAM; TSX: BAM.A) made a proposal to Brookfield Property Partners L.P. (“BPY”) (NASDAQ: BPY; TSX: BPY.UN) to acquire all of the limited partnership units of BPY that it does not already own (“BPY units”) at a value of $16.50 per BPY unit, or $5.9 billion in total value.

Basically, take the company private.

In light of this news, I sold all the BPY.UN/BPY units I owned and locked-in my price premium. I moved all that money and bought a boring, low-cost indexed ETF for the U.S. Total Market (VTI).

What does this have to do with RioCan and buying more in 2021?

Well, I suspect there are more changes to come as the real estate market either gets hammered by the pandemic and/or there is some further consolidation in this sector.

But unlike BPY.UN/BPY that may not have wanted to cut its juicy dividend to shareholders, therefore Brookfield takes the company private instead, REI.UN has already cut its dividend by 33% (in 2020) to fuel existing and future projects.

Recall RioCan is one of Canada’s largest real estate investment trusts. They own, manage and develop retail-focused, increasingly mixed-use properties located “in prime, high-density transit-oriented areas where Canadians want to shop, live and work.”

The recent RioCan dividend cut was smart. It preserved company cash for projects, a few right down the road from where I live in fact. I’m optimistic this business model of owning property where Canadians shop, live and work will help RioCan emerge, not unscathed by the pandemic of course, but at least the potential for being stronger. That’s my bet. I could be wrong. I have no idea. Coming out of this pandemic could take another 1-2 years. But with REI.UN as only a very small portion of my portfolio (<1%) I see few major risks. I will add more REI.UN units this year where I can amongst these other stock priorities.

REI.UN January 20, 2021

4. Alimentation Couche-Tard (ATD.B)

I’ve owned ATD.B for only a few years now but I like what I see and own.

Remember, total return matters, not just yield.

ATD.B January 20, 2021

In the last 4-5 years as a shareholder, I’ve seen the price rise split-adjusted (most recently January 2020) and some consistent dividend increases as well.

I own this stock to have some proxy-exposure to our Canadian consumer market sector but to also have some built-in diversification beyond Canadian borders.

Couche-Tard is a multinational convenience store owner-operator with tens of thousands of stores across Canada, the U.S., Mexico, Ireland, Norway, Sweden and more international countries.

Couche-Tard has deep pockets and I have little doubt they will grow more via acquisitions over time.

5. BlackRock (BLK)

My goodness, what a juggernaut.

BLK January 20, 2021

BlackRock, Inc. is an American multinational investment management corporation based in New York City. Founded in 1988, initially as a risk management and fixed income institutional asset manager, BlackRock is now (and has been) the world’s largest asset manager for some time. They have almost $8 trillion in assets under management as of end-Q4 2020.

While BlackRock provides a wide range of services to institutional, intermediary, and individual investors including corporate, public, union, and industry pension plans, insurance companies, third-party mutual funds, endowments, public institutions, governments, foundations and the list goes on….you and I might know BlackRock more for its brand and menu of iShares ETFs.

I’m a huge fan of many of their low-cost ETFs (and owner of a few).

BLK has an impressive dividend history and combined with tremendous growth over the years, I really only want to own more. With the wave of lower-cost investing far from done, I can’t see any good reason not be a shareholder. This is one of the very few companies in the world where you want to own the products AND the company too.

How do these purchases fit into my overall investment plan?

For the curious, I continue to keep my portfolio aligned to these general rules:

  • For the Canadian portion of my portfolio, I strive to keep <30% Canadian financials including banks. You don’t see any banks in my list today. I have no intentions of buying more this year other than DRIPping the Canadian banks that I already do – about a dozen shares overall per quarter.

You can learn all about DRIPs (Dividend Reinvestment Plans) on this dedicated page here.

  • I prefer to keep <20% energy stocks for my Canadian portion, ideally about 10% overall, including pipeline stocks such as ENB, TRP. I don’t intend to add in 2021. 
  • I target about 10-15% utilities overall. Although I’m a huge fan of renewable stocks. See AQN!
  • I like telcos. I strive to keep 5-10% communications such as BCE and Telus in Canada.
  • Generally speaking – I keep individual stocks to <5% of overall portfolio, although I’m fine should some of my low-cost indexed ETFs become weighted at >5% of my portfolio. Some of them like VTI already are!

Over time, it is my hope to have a roughly 50/50 equity split between dividend paying stocks (from Canada and the U.S. to provide meaningful income) and low-cost ETFs (to deliver mostly growth) from my portfolio.

I’ll update those plans and assumptions in a future post – but you can see some of that previous thinking about retirement income planning here. 

Overlooked retirement income and planning considerations

As I work through these purchases in 2021, I will keep you posted.

I keep my Dividend page up to date here.

I keep this dedicated page about the best low-cost ETFs to own, and what I own here.

What do you make of my stock selection choices? What are you buying in 2021? Some individual stocks or ETFs or a mix of both?

My name is Mark Seed and I'm the founder, editor and owner of My Own Advisor. As my own DIY financial advisor, I've surpassed my goal and I'm now investing beyond the 7-figure portfolio to start semi-retirement with. Find out how, what I did, and what you can learn to tailor your own financial independence path. Subscribe and join the newsletter! Follow me on Twitter @myownadvisor.

47 Responses to "5 stocks I want to buy in 2021"

  1. For interesting insights into Blackrock, see this article:
    https://journal-neo.org/2021/06/18/there-is-more-to-blackrock-than-you-might-imagine/
    Here’s an excerpt:
    “How the world’s largest “shadow bank” exercises this enormous power over the world ought to concern us. BlackRock since Larry Fink founded it in 1988 has managed to assemble unique financial software and assets that no other entity has. BlackRock’s Aladdin risk-management system, a software tool that can track and analyze trading, monitors more than $18 trillion in assets for 200 financial firms including the Federal Reserve and European central banks. He who “monitors” also knows, we can imagine. BlackRock has been called a financial “Swiss Army Knife — institutional investor, money manager, private equity firm, and global government partner rolled into one.” Yet mainstream media treats the company as just another Wall Street financial firm.

    There is a seamless interface that ties the UN Agenda 2030 with the Davos World Economic Forum Great Reset and the nascent economic policies of the Biden Administration. That interface is BlackRock.”

    Reply
      1. I was thinking about investing in BLK but remembered hearing something disturbing about them, so searched ”Is BLK an ethical company?” I’m not sure if the above article is in the realm of conspiracy theory but it seemed to ring true to me…

        Reply
        1. Yes. I mean, BLK is huge, and it’s really hard to know what’s going inside or not but overall, they have paved the way for some low-cost DIY investors to do very well thanks to their ETF products.

          Reply
            1. I did read it. I’m not sure how much I believe to be honest. Comments like this seem to be coming from a high school book report:

              “Fink with $9 trillion to leverage is pushing the greatest shift of capital in history into a scam known as ESG Investing.”

              “In a country where 44% of the population lives in poverty you don’t become the world’s richest man in just two decades selling Girl Scout cookies.”

              I have no doubt BLK is constantly flexing it’s financial muscles to gain more assets under management, influence and such. There are likely many facts here. But to suggest they are practically lacking all ethics is a bit much.

              On the NEO about us page, they “cover political and religious issues, economic and ideological trends, regional security topics and social problems.” They go on to say their “…priority is to promote understanding rather than ideology, strategic outlook rather than simple reporting on events and to reveal causes rather than its consequences.”

              It seems this article was suggesting BlackRock is perpetrating poverty and moreso, is simply infiltrating all Demoncratic political agendas. That’s a bit much but I don’t doubt this company doesn’t have an agenda. They are now too big not too!

              Reply
  2. Canadian National Railway should KILL IT. As long as people are transporting goods, which they always will be, and population is increasing, which it always will be, there’s a good chance Canadian National Railway company will continue to generate income and provide value to their shareholders.

    Reply
  3. I have been really good at maximizing by RRSP/Pension room but have fallen behind in TFSA. I believe in the dividend strategy and index ETFs. I have been investing far and beyond my TFSA room in a non-reg and so im going to slowly transfer investments from my non-reg to TFSA to catch up. If you had significant investment funds, would you go for an dividend index fund or stick to the companies you had your eyes on above? I was thinking id divide up some in XAW, VTI and maybe XUU.

    Reply
      1. Humm. Well, I used to own HDV myself in my LIRA, a small portion, but I decided to go with more VTI across my portfolio myself. Broader index and keep my U.S. winners running like JNJ!

        I also own HGRO for simplicity in my LIRA – an all-in-one fund.
        https://www.myownadvisor.ca/what-is-a-lira-and-how-should-you-invest-in-it/

        I have considered some international dividend ETFs but haven’t pulled the trigger yet. The yield from IDV is appealing but I don’t own it.
        https://www.myownadvisor.ca/top-international-dividend-etfs/

        Are you thinking of investing in any of these ETFs?

        Thanks for reading Logan!

        Reply
        1. Thanks Mark – I am thinking of investing in a few of these. I am leaning towards XAW or VTI (they seem to be competing ETFs and would you own both of these?) and maybe IDV and XDV.

          Reply
  4. I’ve had my eye on CNR for awhile now and finally bought some last March for a steal. Trying to shift to more growth stocks in non registered as our dividends are getting too high (nice problem to have…lol). Just bought some more ATD.B in TFSA when it dropped after takeover bid announcement. Unfortunately I have a fair bit in Riocan in my TFSA so will hold and cross my fingers. Too much of a loss to sell now….besides my TFSA will be the last to be withdrawn so got lots of time to wait. Will sell them when price gets back up though. Love AQN for the same reasons as you!

    Keep up the great work!

    Reply
    1. Funny, same problem! I will only have taxable room soon (saving up to max out RRSP contributions right now, first, then only taxable left later this year…) so need to consider lower-paying dividend stocks but growers for capital gains since that is an efficient form of investing/taxation.

      Thanks for the kind words Sabrina! Keep me posted on your purchases!

      Reply
  5. For the reasons all explained in the link I am providing I am will be moving away from investing in any REITs. I really urge you to watch the documentary linked within this news article from the TYEE.
    https://thetyee.ca/Culture/2020/02/25/Push-Documentary-Tracks-Housing-As-Latest-Investment-Commodity/

    “If the movie had a central message for Vancouverites, it is this: our problems are not unique, they are global. The “financialization” of housing is an out-of-control global pandemic, driven by the hunger of the financial management industry to find things to buy that will increase in value in a world where too much money is chasing too few assets — and where those assets are returning less and less profit as a result.”

    Also on CN Railway, I sent Bob a forward looking document from ARK Investments that says railway will not be as strong in the future. I stated the same as you so I told him about the suggestion that North American rail may soon be the next “disruptor” casualty. You can download this pdf here ~ https://ark-invest.com/badideas/

    Reply
    1. Ya, potentially you are correct Chris about the railways. I guess I just see us/collectively in Canada either moving more goods by rail or by pipeline. Look at the upcoming hydrogen investments – that fuel has to move somehow right? EVs/EV trucks are only going to take us so far. Then there is the infrastructure needed for EVs. We are a solid 10-20 years away from that. I can’t see the need for rail disappearing in my lifetime but I could be totally wrong.

      Just wait and see when CNR announces a 10+% dividend hike soon 🙂

      As for REITs, I don’t own many. I will try and watch that doc – thanks for the link.

      I wouldn’t just blame REITs though. The “financialization” of housing has been going on for decades fueled by ultra-low rates. My thesis is, you wouldn’t see this (as much) if borrowing costs were back into 4-6% as they should be. There is no incentive to save now with low rates. Only to spend. That means as long as you have a climate that encourages spending it’s not going to get better.

      Reply
  6. Good recommendations, Mark. They are all excellent stocks. I particularly like Boralex, so far one of the best performing renewables. Under Biden, clean energy and climate change themes will be among the best performers. I like a lot Plug, Ballard, Bloom Energy which should (hopefully) provide me with superior returns.
    Good luck with your investment.

    Reply
    1. Thanks Ken. I’ll probably put in order of any buys AQN, BLK and then CNR. REI.UN would be the last I add to this year.

      I’ve been looking at Boralex. More room to run you think? Maybe I should own some in taxable for CDN dividend tax credit?
      Mark

      Reply
  7. I’m looking as well to top up some more CNR to my existing position whenever I can. Great moat and dividend grower. I added a little to RioCan last March at around $14. I will not add anymore.

    I am also not going to add to the big 5 banks anymore this year. Last year most of my dividend income went into topping up RY,TD and BNS right before the jump in November. So my portfolio now as around 28% big banks. Enough for now.

    Reply
    1. Ya, I’m DRIPping REI.UN EZDividends I probably won’t buy more unless I’ve managed to buy more CNR, AQN, BLK and others in my top-5 list first. Those three are my priorities for sure.

      Smart call on banks. You might get a correction later this year/we all might to buy more as you please!

      Reply
  8. Hey Mark,

    Big fan of Alimentation Couche-Tard (ATD.B). This is a hugely undervalued stock that I think people don’t understand. Like Blackberry it has been unloved for years by the investing community. Some point in time there will be a catalyst just like Blackberry experienced Dec/Jan and holders will finally be rewarded. At the current valuation it is a great buy and in my mind recession/pandemic proof for the uncertain times ahead this year. Buy it and forget it.
    AQN is a no brainer in Biden’s environmentally friendly administration. I’m holding this one along with Transatla Renewables and a growth stock play of Greenlane Renewables to take advantage of a hot sector with dividend income as a bonus.
    RioCan I have to pass on. I would like to back the truck up like you for long term returns, however I paint it with too long a recovery horizon which keeps me out of Air Canada too even though we all understand both will be clear winners in the long term. The horizon is too long to tie my money up on with other investments that will return gains to my portfolio a lot quicker.
    Blackrock is certainly intriguing however I already hold an expensive backstop in my portfolio being Shopify which I love to buy more of on any dips and in the weeks prior to earnings report(read February coming up). Shopify is really getting entrenched as a growing platform of choice with third party seller sales exceeding that of Amazon third party for Black Friday and we are in an increasing online world with Shopify extending their online offerings making it a solid buy and hold addition to a portfolio albeit with some volatility.
    As for CNR, rail stocks are just something I’ve never contemplated for no particular reason although after seeing some of the blockades last year across the country I’d be worried what a prolonged attempt would do to this sort of stock.
    Good luck in your purchases and if you aren’t dollar cost averaging in then here’s to having some cash on hand so as to buy on the dip when we have a pullback in the market in the next couple of months.

    Reply
    1. Great to hear from you Jeff and your detailed comment. Love that.

      If I had to put some of these stocks in order of buys – likely go with AQN, BLK and CNR. REI.UN would be last for sure but I might nibble if it stays around $17 or $18 for a bit.

      Shopify I missed the run up. Good on you to own some. You think it’s still too expensive to buy? Thoughts?

      I also own some INE for renewables and of course BEPC. I’m very bullish on renewables and I have considered TransAlta Renewables, just not owning yet.

      What do you like in this sector?
      Mark

      Reply
  9. Solid picks Mark. I’d love to get into BLK. Had BLK in the kids’ ShareOwner portfolio and it did very well.

    It will be interesting to see where RioCan goes from here. I do think it’ll recover but may take some time.

    Reply
  10. This year I have already bought IFC, ATD.B, MRU and AP.UN. Waiting to buy more CNR. Looks like CNR is in a down trend right now. Almost pulled the trigger yesterday.

    I have a tiny position of REI.UN and decided just to hold it. Not selling it but not adding to it either. It does not fit my investment strategy of Dividend Growth stocks so I actually should have sold it long term ago.

    Reply
    1. Ya, I would put REI.UN last on my list but very bullish on the rest. Just need to save more $$ May 🙂

      RioCan makes up <1% of my overall portfolio. It will come back I just don’t know when!

      ATD.B is great and cheap now. Hope to buy some in the next few months.

      Stay well!

      Reply
      1. Great suggestions and insights, Mark. For me, the most difficult is deciding WHEN to buy. Do you have a set of rules helping you to determine a good time to buy a certain stock? We all know that timing the market is a losing game, and yet, any rational investor is striving to buy at a good price. Many thanks

        Reply
        1. Thanks Marie. You know, I don’t really have too many rules on when to buy. Kanwal (a friend of mine) wrote a post on this and some of my thinking aligns to his.
          https://www.myownadvisor.ca/how-to-build-an-income-portfolio-using-12-simple-steps/

          I don’t have nearly as many rules as this nor when to buy.

          I tend to buy when a) I have money, b) I have enough money to keep my transaction costs as a % of the purchase low, and c) I have some personal conviction it’s a good time to buy – i.e., there is a market correction of 5-10% or more. That’s about it. 🙂

          Reply
  11. Hi Mark , just 2 weeks ago i bought 200 shares in TC ENERGY knowing the keystone was going to be shut down,anyway. Price was the close to the same as when pandemic started at $53.00. Just another great dividend growth company on sale. When you own TC & CNR & they dont want to make anymore pipelines , what pipelines left become more needed as well as railways.Also bought FORTIS.
    steve

    Reply
    1. I think they knew all along and it was priced in. I mean, how could you not see this coming after Trump was gone.

      Either way, to your point, TC will be around for decades to come and happy to have this toll-road-like company as a small portion of my portfolio for mainly income but also some growth. FTS is great and I own hundreds and hundreds of shares. Very bond-like. Ha!

      To your point, either we build more pipelines or add more rail capacity. Win-win for shareholders.

      Reply
  12. Great list, Mark. Today we just added more AQN to our portfolio. We’re deciding the next one to start investing, either CNR or ATB.B.

    I am intrigued by BLK – never thought of it before, but will certainly consider it, especially in our RRSP.

    Thanks and stay safe!

    Reply
    1. BLK is a great stock – a company where you can own the stock and you love the funds 🙂

      Ha. Certainly my 5 stocks are not recommendations for purchase, just what I want to own and why.

      Great to hear from you and stay well! See you on the Twitter machine too!

      Reply
  13. I believe in the long term outlook for Riocan because they have a wealth of good properties in their portfolio. However, the plan to pivot from mainly retail to a more mixed use offering will take 5-10 yrs at least as construction projects require a lot of time to ramp up and complete. They pay 5.5%, which is good but there are other blue chip stocks that pay close to similar % payout. Add that to the fact this payout does not qualify for the dividend tax credit, which obviously matters a lot if you hold it in a non-reg account, and I see opportunities elsewhere.

    I owned REI.UN for 15yrs but sold it in the spring of ’20 to buy something else. I have no doubt they’ll turn that big ship around but I decided I couldn’t wait the time required for that to happen.

    Like you said, “That’s my bet. I could be wrong. I have no idea.” Let’s check back in 5yrs time! haha

    Reply
    1. Ya, RioCan will be a multiyear recovery but I figure with a low % in my portfolio, it’s a small risk to buy more. Indexed ETFs are going to approach 50% of my overall portfolio in the coming 4-5 years, for growth, and then the rest (50%) is income oriented.

      I only keep my REITs in registered accounts for the reasons you know.
      https://www.myownadvisor.ca/dividends/

      Let’s compare notes in 5 years to see if RioCan is back in the 20s or approaching $30/share!

      Reply
  14. Hi Mark, I also hold CN and have been happy with the growth of the company. I think with the pipelines in the public view, trans mountain and line 3, the writing is on the wall. That is why I also like your AQN pick. Renewables are the future. I have held REI for many years but finally sold just before the dividend cut, my option is that retail and office space is in for big changes and I’m not going to wait and see what happens. I always enjoy your articles, please keep up the good work.
    David

    Reply
    1. Thanks David! It will be interesting to see what happens in the REIT space for sure. Big changes are underway. More industrial REITs to own if anything? Granite? Summit? Other?

      I own a number of renewables and happy to support this space – it should be the future…needs to be.

      Buying anything yourself this year?
      Mark

      Reply
      1. Hi Mark, I feel valuations are high right now so I’m waiting to see how the market plays out in the next few months. I bought a speculative stock with my mad money and it seems to be working out for me. MMED is the symbol. All the best

        Reply
        1. Interesting David. I’m all for some speculative plays but don’t bet the farm on anything, and I personally wouldn’t risk anything over 5% of my money on any one stock. Keep me posted on MMED!

          Reply
  15. Mark, do you have any thoughts on the long-term prospects for Canadian telcos? I have $28K split across Telus, BCE, Rogers, and Shaw. Their prices are down by around 15% from the pre-pandemic era. I’ll hold them for now, but was just wondering about their future prospects.

    Reply
    1. Gosh, hard to say Bob. I keep a good portion of my portfolio in telcos (BCE, T, AT&T, VZ) as per post (say up to 10% or so?) since I see these as modern day utilities. We love our cell phones. I probably wouldn’t go over 10% overall in telcos personally but that’s just my choice for diversification risk.

      You? Worried about deregulation? Other?

      Reply
      1. I’m just feeling a little uneasy. They are so dominant and profitable today, and I wonder how long the gravy train can keep going before deregulation and a disruptor have a big impact.

        Reply
        1. Well, I’m going to keep within my personal target of 5-10% telcos overall (Canada and U.S.) and ride the dividend train until something happens i.e., a dividend cut. Might happen to AT&T soon but my holding is <1% overall portfolio there, as in not very much. I have about 3% combined in BCE and Telus.

          Reply
  16. The RioCan story has been an interesting one. I’m curious to see how much this whole working from home thing sticks in 2022 and beyond, when COVID is (hopefully) wrapped up. Looking at it’s current price, I find myself so tempted to buy some shares in the hope of another post 2008 style rebound. I probably won’t, given that I’m a dedicated ETF investor. Speaking of ETFs, Blackrock is another company I’m tempted by.. You know these are some good stock picks when you have ETF investors interested (ha)!

    Reply
    1. Yeah, I mean, I looked at my portfolio last night and RioCan is 0.61% of overall portfolio. So, buying a few shares (up or down) isn’t going to break me. If my hunch is right and things work out in the coming 1-2 years I know I will be rewarded since the share price will be back into the 20s or higher.

      This is largely why I have a internal rule to keep <5% to any one stock. If VTI or QQQ become 10% or 20% of my overall portfolio (and they probably will at some point!) that’s OK by me 🙂

      Reply

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