5 stocks I want to buy more of in 2020
For ten years now, I’ve been a DIY investor, focused on buying and holding many dividend paying stocks for growing income.
Beyond the upcoming 5 stocks I want to buy more of in 2020 you can check out my 2010-2019 financial decade in review here.
I look forward to sharing my updated December 2019 results soon!!
Over the years, my bias has been to buy and own many Canadian dividend paying stocks for the long-haul.
With a new year comes new investing opportunities. The end of 2019 and the start of 2020 offered a chance to assess my portfolio stock holdings in recent weeks and figure out what sectors (and therefore stocks) of our Canadian economy I should consider loading up on in 2020.
This post highlights 5 stocks I want to buy more of in 2020.
Our Canadian telco space is rather unique in that only a handful of players dominate the market: Telus (T), Bell (BCE), and Rogers (RCI.B).
Over the last decade as a DIY investor, I’ve focused on owning just Telus and BCE. In more detail, I like Telus as an aggressive play on our Canadian wireless industry. In recent years, Telus has inked a number of partnerships that should help their growth. Advances towards 5G technology and our population growth (with more wireless customers) should also drive stock prices higher (and provide more dividend raises).
I hope to add another 100+ shares of Telus to my portfolio to this year. That could be inside my Tax Free Savings Account (TFSA) with upcoming available contribution room.
Canadian telcos make up <5% of my total portfolio. I’m comfortable with any Canadian telco stock or dividend paying stock for that matter valued at 2-3% of my total portfolio value.
As an fyi, as a comparative for our communications sector allocation in Canada, here is a recent sector breakdown of our S&P/TSX Composite Index represented by ETF XIC:
Canadian National Railway (CNR)
Canadian National Railway (CNR) is in the rail transportation business, with a network of some 20,000 miles across North America. If you need to ship something across our continent, it’s probably coming via use of CN rail. In fact, the recent CN rail strike provided evidence that our economy relies mightily on that network to avoid losing hundreds of millions of dollars in delayed goods and services from any industrial bottleneck in any given day.
Furthermore, based on this dividend history, I have full confidence CNR will continue paying let alone increasing their dividends over time.
Canadian Apartment REIT (CAR.UN)
“Buy land, they’re not making it anymore.” – Mark Twain
CAPREIT is one of Canada’s largest real estate investment trusts, and they also own residential units beyond Canada’s borders. I like this type of built-in type of diversification from many of my Canadian stocks.
My collection of Canadian REITs currently make up just shy of 7% of my portfolio, where CAR.UN is just one of seven REITs that I own but the only REIT I’m currently unable to DRIP with my brokerage. So, I would be very happy to add a few hundred more shares of this stock for income and growth, and to reinvest all dividends paid with.
Through its acquisitions, including Florida-based TECO Energy, Emera (EMA) has been able to grow its presence in North America. That has translated to increased profits. Stronger profits are great for shareholders like me because it can mean more of the company’s cash can be diverted to paying down debt, fueling more acquisitions and of course my favourite, more dividend increases.
Here is the recent dividend growth of EMA:
Emera continues to grow as an energy leader with $32 billion of assets, who serves more than 2.5 million customers in Canada, the US and the Caribbean. With so much safe, clean, reliable energy depended upon by so many (growing) customers, I’m very confident in EMA’s long-term prospects.
Brookfield Renewable Energy (BEP.UN) or Brookfield Property Partners (BPY)
Renewable energy boasts strong long-term growth potential. Plenty of high-growth stocks in the sector are trading at attractive valuations – and BEP.UN is one of them.
Brookfield Renewable Partners (TSX:BEP.UN)(NYSE:BEP) is a $13 billion-plus company and a giant in the renewable energy industry, and growing. It owns and operates an extensive portfolio of diversified renewable power assets located worldwide. It is not just a leader in Canada’s renewable energy industry. It is one of the leading companies in the sector globally.
I might also take a run at BPY too. Time will tell!
More stocks to own in 2020?
Are there other stocks on my buy list for 2020? Absolutely. But these ones are at the top of my list for some built-in diversification beyond Canada’s borders and the fact I already have a healthy amount of Canadian banks and pipeline stocks from the energy sector in my portfolio at this time.
Although I have no intention of selling any Canadian stocks that I own, I want to diversify beyond from Canadian bank dividend stalwarts like Royal Bank, TD Bank and pipeline stocks like TC Energy (TRP) to ensure my stock allocation remains somewhat in sync with the S&P/TSX Composite Index (albeit with a few biases).
For the curious, I strive to keep my Canadian portfolio around the following sector allocations:
- <30% Canadian financials including banks. I don’t want too much of this sector risk.
- No more than 20% energy stocks including pipeline stocks such as ENB, TRP.
- Max 15% REITs.
- 10-15% utilities. Although I’m a huge fan of renewable stocks.
- 5-10% communications; think BCE and Telus (see above) in Canada.
- and the rest from various sectors including materials and industrials; CNR being one holding of many.
As 2020 unfolds, I’m sure I will tell you what I buy and just as importantly, how much those purchases might have added to my existing income stream for some semi-retirement plans in the coming years.
Happy investing in 2020! See you here often next year!
Here is David Swensen on asset allocation – including what I disagree with.
Here is how you can consider living with stocks by keeping a cash wedge in your portfolio.
You have a great list, Mark. For the rest of the year, I would like to invest more in the green energy and renewable sector, including the red hot EV (electric vehicle). I have a small position in NIO, BYDDF and some ETF’s in solar. I think these sectors have immense potential. I prefer to invest in growth stocks than dividend paying ones.
Good luck with your investment.
I would agree about renewables and green energy. Here at home, for larger stocks, I’m rather bullish on AQN, BPEC, INE and a few others. I don’t see our planet surviving in another few generations without greener/cleaner energy.
Good luck as well, stay in touch.
Another good read Mark. I hold almost all these securities except BPY, I’ve been reluctant though a juicy dividend to pull the trigger as the chart appears to making lower highs of late, I’d be interested in your thoughts on this trend?
It is a juicy dividend isn’t it? I’m a happy owner for now and hard to say it will or will not continue but I’ve heard from various analysts it is undervalued. Are they right? No idea, but I like the cash flow and I’m reinvesting about 3 or 4 shares per quarter.
Hi Mark, I hope your weekend is off to a great start! Do you hold all of your stocks that pay US dividends in your RRSP? Thanks for your help!
You got it Vanessa. I don’t own any U.S. stock or U.S. ETF at this time outside my (and my wife’s) RRSP or LIRA.
Happy New Year Mark,
Catching up on my weekend reads and saw this post. You’ve mentioned your foundation before (good jobs, reasonable expenses, pensions, and obviously a great focus on your family’s investments and a better than average knowledge of tax treatments). Given your recent move to a more manageable property, plus your focus on 35-50 of the top corporations (dividend payers); I’m wondering if you allocate any risk or riskier capital.
It may not be for everyone, but with such a strong foundation around you and your wife’s lifestyle, do you allocate any registered/TFSA (although no capital losses carry forwards) or non-registered funds to deflated smaller-medium oil players (other than the pipelines and SU?), junior golds, or even Canadian Tech high flyers like CSU, OpenText, Shopify?
I love your attention to your mission, but I know if I have my future lifestyle needs met; the gambler would want to come out and play late at night 🙂
Keep up the great work.
Great questions Ash and Happy New Year!
I’m rather conservative I think with our investments, hence the draw to dividend investing, more predictable (?) so no, I don’t really dabble outside the TFSA, RRSP, and non-reg. investments. I don’t dabble with junior miners, high-flyers like CSU or OpenText or SHOP. In hindsight of course, those companies would have been VERY smart to get into and buy and hold but I find there are very speculative. As such, more risk, more potential reward.
I think once I have my financial goal foundation set I probably could take on more risk but right now, not for me 🙂
I hope that helps! Happy investing in 2020.
Great list. I own 3/5 of the stocks you listed. Will look hard a CAR-UN for my RRSP. I need to add some REIT exposure and it seems like a great one. It looks like it’s had a great run but I like the divy payout. Thanks for jogging my memory on this one.
Good to hear from you. I think the demand for RE is going to continue in Canada with our growing population and increasing immigration which is great since it should continue to help REITs in this prolonged low-rate environment. I could be totally wrong of course!?
All the best in 2020,
Happy new year!
For 2020, i am looking at cnr, mru, cu and telus.
Selling enb as I am not comfortable with the negative dividend payout ratio and negative cashflow. I wonder if the high dividend increase is sustainable in the long run.
Yes, I too have concerns with ENB debt. Hopefully they have a plan?!
Happy New Year back!
Happy New Year Mark!
I own all but CAR no surprise as the list of great dividend companies is not infinite:)
I just picked up a bunch of BCE (TFSA) to get it to double drip but will leave T, EMA and CNR be unless value returns all are great holdings IMO. BPY is priced right but already dripping nicely so that’s a tbd. My short list is rather short looking to add to FTS (TFSA) and possibly BEP+BIP (RRSP) for existing positions. I’m not looking at my banks although they are attractively priced I’m already financially overweight.
Might add a couple of new positions along the energy transition/ageing+healthcare themes i.e. NEE/NPI/NWH and seek more international exposure but much research remains to be done.
Also looking at AAPL/MSFT, AAPL just broke $300 and is still fairly valued believe it or not. Kicking myself for not buying it during the last dip. If only we had a crystal ball we’d all be rich. MSFT is a great company but quite overpriced I’d consider it around $100 not more. In general the US is overpriced relative to yield too much downside risk for me right now.
Thanks for sharing your insights and fostering this great community. All the best for 2020, invest well and prosper!
Yes, only 50 or so stocks worth owning in Canada for dividends….otherwise, just index invest!
Big fan of FTS, BIP, BEP, and BPY as well. Hold a few hundred shares of each and happily DRIPping 3 or more shares of each every quarter. I like the Brookfield companies in the RRSP for USD $$ dividends as well.
With an aging population, I’ll be looking at more MRK, MDT and a few other U.S. healthcare stocks. I am considering owning ITOT ETF that holds those “FAANG” tech stocks you mentioned and more. Yes, if only we had a crystal ball… I think tech stocks seem overblown right now but who knows….people have been saying the market is frothy for a few years now!!
All the best to you in 2020, always appreciate your detailed comments.
CNR, EMA and CAR.UN are on my list for TFSA. Also looking forward to reading more of your articles in the new year!
Thanks very much, I look forward to your readership!
I am a regular reader of your blog. You give a lot of information for people like myself, who are not familiar with the investments.
I stumbled on your site few years back. Started my DIY investing after that.
I want to let you know that you inspired me to do dividend investing. On this new year, I want to tell you “Thank You. You made my life better by creating this website.”
Wow, such a nice comment. Thanks for your readership and happy to connect with you.
Best wishes for 2020.
Happy new year Mark and everyone ! hope 2020 will bring us more wealth and more dividends 🙂
I love your stock choices as they all make sense CNR and T and BPY but as an ETF investor I’ll be adding more ZLB to my TFSA this year , i do hold VCN in RRSP and ZLB in TFSA it’s just that i like the way ZLB is been structured and so far it’s been outperforming.
thanks for all the effort Mark and I’ll be looking forward to read your articles in 2020.
I appreciate your post Gus. I’ve been trying to decide between ZLB vs ZDV… but I like the low volatility holdings of ZLB as you noted.
It’s been on a tear over the last few months, so I’m thinking of buying if the price falls back a bit further.
Hello K ,
I owned XEI in my TFSA for a while and i read so many bad articles about it that made me switch to ZLB and hopefully stick with it for a long time . Funny that XEI holds all blue chips stocks but the price is stagnant since inception unlike ZLB which shows growth and good yields.
Total return on XEI since inception has been 66% as of November 30.
I’ve heard great things about ZLB and the MER is modest for that one as well to own 47 stocks that should pay out ETF distributions in good times and in bad.
Happy New Year Gus – I hope 2020 is kind to us for more dividends as well 🙂
ZLB is a very solid pick for CDN equity with a modest fee.
I have a bias to the dividends myself, so likely one or more of these stocks are going into my TFSA very soon.
I look forward to your readership and comments this year too.
Happy New Year Mark!
I always look forward to your weekly articles. As a newbie self investor, I find your posts very informative and easy to understand… a great combo!
Two questions for you today…
1… As a rule of thumb, do you use DRIP’s in your Registered Accounts and cash dividends in your Non-Registered Accounts?
2… your thoughts on CNQ and ENB?
Thanks and all the best in 2020.
Thanks for the kind words K!! Happy New Year and thanks for being a reader!
re: 1. Over the years, I’ve gone back and forth on the dividends to be reinvested in my non-registered account but I’ve decided for the last few years to turn “ON” all stocks to DRIP in that account. I figure it reduces my behavioural biases to do something else with the cash building up….
As a rule of thumb, I do therefore use DRIPs in both my registered accounts (TFSAs, RRSPs) and non-registered.
2. Thoughts on CNQ and ENB? I own a bunch of ENB and it’s DRIPping very nicely so to avoid going overweight in any one stock I need to consider other stocks in my portfolio to buy. Big fan of ENB though and it was actually the very first individual stock I bought many years ago….
In terms of CNQ, it’s a bit of a bet on oil and gas and I’m just not sold on that sector. Very cyclical. The stock price has been largely flat for 5-years but at least via the dividends you get paid to wait for price appreciation. I don’t own CNQ myself.
Most of my holdings are listed on this page for transparency:
Happy investing and good luck with your investing decisions!
Thanks for your valuable response, Mark. For 2020, I plan to increase my investments for both TFSA and RRSP with tech stocks, mainly through ETF’s holding the proven stocks like Apple, Microsoft, Intel, Cisco, etc which yielded eye-popping returns!!! I am even leaning towards buying more the 3 X Bull daily performances of the Index Fund (like TECL, has performed so well and had + 150% return in 2019). Of course, I want to play safe too and plan to buy stocks like utilities, consumer staples and REIT’s in both TFSA and RRSP, though I prefer the U.S. stocks with higher potential. I like taking risks and invest in risky stocks too and hope to make it big (pun intended)!!! This is why I have invested quite a bit in MJ industry, focusing on U.S. multi – state operators (MSO’s) as I strongly believe the U.S. will legalize the pot industry at the federal level in the not too distant future.
To your wealth,
I think for us, I’ll continue to own CDN stocks inside the TFSA and U.S. stocks and ETFs in the RRSP.
I’m absolutely thinking of buying a low-cost U.S. ETF like ITOT for the Apple, Microsoft, Intel, Cisco, etc. for the RRSP.
You might be right with your investing risks and play with the MJ stocks! Your portfolio will kaboom/go through the roof if that occurs…
Happy investing and keep us posted!
I like a lot about ITOT. Another good one to consider is IETC which has provided superior return.
I realized I am taking huge risks with the MJ stocks. Either I hit it big or go kaput!!!!! I need all the luck to be successful!!!!
I look forward to reading your next articles. Keep up the good work.
Interesting… > 30% invested in just 3 companies though.
I think ITOT for the USD part of my RRSP might be good for tech (22% of assets) and for the uber-low MER of 0.03%. I also get 3,500 stocks to own as well! 10-year returns with ITOT are >13%.
I think this or VTI might be a long-term winner for me in my RRSP.
Continued success to you and stay in touch.
Mark, it’s always a pleasure to read your insightful articles. I noticed you stick with Canadian stocks inside your TFSA because of the tax advantages on tax treatments. I wonder is it not more beneficial to buy high growth U.S stocks like Visa, Apple, Microsoft, etc that can result in a lot more higher returns (even after considering their less than favourable tax treatments) than Canadian stocks? Also, how about allocating a small portion of TFSA portfolio in a few high risk stock that can give you a ten bagger? High risk, high reward can increase the value many times!!
What do you think of the pot stocks in TFSA a/c? Almost all the MJ (marijuana)stocks had a terrible year in 2019, but what are your thoughts on companies like Valens and Medipharms companies that specialize in extractions instead of growing and cultivating pots companies? These extraction companies are a lot less risky than MJ producers, but have a lot more potential to earn high returns. Thank you for any comments you can provide. Happy and successful investing in 2020.
Lots to unpack there Ken!
Thanks for the kind words by the way. Very nice of you….
I do stick to CDN stocks inside the TFSA, for the simple reason that I tend to use my non-reg. account and TFSA (along with my wife’s TFSA) for CDN stocks and then use my RRSP for (more) U.S. stocks and ETFs over time. The strategy has worked out well overall for the last decade so I see little reason to change the approach.
Now, that said, I really wanted to buy MSFT shares in particular many years ago, and did not. Kicking myself now of course…
I have definitely considered owning lower-yield U.S. stocks like those you mentioned on the USD $$ side of the TFSA (like Visa, Apple, Microsoft) but I haven’t pulled the trigger on it yet. I might this year, we’ll see. Those U.S. growth-oriented stocks can also be rather tax-efficient inside a taxable account – as you probably know.
I don’t have much in the way of direct technology stocks in my portfolio, so that’s something I’m trying to address with time.
In terms of the pot stocks: I held one only very briefly (ACB) and then I came to my senses. Meaning, owning the MJ stocks was not aligned with my investing principles that focus on dividend payers and what has made me successful to this point, so I sold it a long time ago and luckily I broke even. To your point, taking a higher-risk play with a small amount of $$ can work out for sure….re: your ten bagger, I just don’t know in advance what that stock might be?! That’s where my bias to dividend payers comes in. Cashflow today and money that can be reinvested over time. This way, I don’t have to hope for just capital gains to deliver returns.
What are your plans for the TFSA or RRSP in 2020?
All the best for the new year back.
Hi Mark, I just bought some BPY in my TFSA. Didn’t realize they pay dividends in US$. Will this be a problem with taxes? Is it better to move it to my RRSP?
What other REITs do you have? I’m eyeing CAR.un as well.
Happy 2020! Yes, some Canadian stocks pay dividends in USD $$ so you need to be mindful of that and perform any due diligence before any purchase – stocks, ETFs or other.
You should likely talk with your brokerage but my assumption is BPY.UN (CDN listed stock) held on the CDN $$ side of your TFSA will get the full dividend; just that the USD dividend will be converted to CDN $$ for your TFSA.
BPY (U.S. listed stock of BPY.UN) will be charged withholding taxes inside the USD-side of your TFSA.
By putting BPY (the U.S. listed stock) inside the USD $$ side of your RRSP, you should get the full dividend paid out in USD $$ AND you won’t be charged withholding taxes since all U.S. stocks or U.S.-listed ETFs avoid withholding taxes inside the RRSP. Again, you should confirm with your brokerage how BPY or BPY.UN dividends might be handled.
I provide an overview of what I own and where I own what I own on this page here.
Happy investing and good luck in 2020!
Thanks Mark! This is very helpful for a newbie investor like me and I really appreciate you taking the time to reply.
And yes, happy new year to you too!
I have BPY in my taxable account. As I want to withdraw the money in USD to spend on travelling and shopping online, I put them on the USD side. The distribution includes many different part, only the US dividend part will be charged with withholding tax. For the Dec 31 distribution, only 2.1 cents US dividend per share, so the withholding tax is very tiny. With the 800 BPY I have, 0.25 in total was withheld.
Gotcha. Yes, BPY does provide some nice USD $$ dividends and you are correct, withholding taxes apply to those dividends paid but should be recoverable at tax-time in a taxable account.
Well done with 800 shares and great for USD $$ online shopping!
Mark , I think whether taxes are withheld is dependent on whether the company is Canadian or not; the nature of the income being distributed and the account in which the investments are held – RRSP vs TFSA. Whether you choose to take the distribution in Canadian vs. U.S. dollars BPY or BPY.UN I believe is irrelevant as far as withholding tax is concerned. If withholding tax is applicable, I believe you are going to be charged withholding tax whether you hold the stock as BPY.UN on the Canadian side of your ledger or BPY on the U.S. side. As one of your readers notes below, part of the distribution for BPY is U.S. dividends and attracts withholding tax. If I choose to hold the same investment as BPY.UN in the same type of account as the BPY , I believe that the U.S dollar dividend paid in Canadian dollars will still attract withholding tax. Your thoughts.
I tend to agree Ron. Based on what I’ve experienced personally, and read from Brookfield’s site, I prefer to get the USD dividend payment (without any CDN $$ conversion) from owning BPY inside the USD $$ side of my RRSP. Then I don’t need to worry about any portion or not of U.S. withholding taxes. It’s complicated!
Thanks for the great list. The only one I don’t have is CAR.UN. I feel it’s too expensive right now and probably will not buy it at current price.
I recently added T, BCE, BPY.UN and FTS. I plan to buy more T, CM, CNR and TD in January. I am debating to buy CNR in TFSA or in taxable account. I already bought some MX from the top dividend list of money sense. I want to buy some stocks that distributes USD and MX suits my need well and not expensive at this moment. But I could have caught a falling knife.
What is the reason to choose EMA not FTS, @Mark? I am looking at these two and feel EMA is more expensive than FTS. That’s why recently I bought more FTS, not EMA.
Nothing wrong with FTS whatsoever! Just that I have a bunch of Fortis and it’s nicely DRIPping along at x4 shares per quarter for me so I don’t want to get overweight in that one stock either.
I also like owning some CDN stocks that pay dividends in USD $$. The Brookfield family of stocks (BPY, BEP, BIP) do that very well and those all tend to increase their dividends as well.
great list. I own 4 out of the 5.
Cnr is tops on my list as its playing with the 5% mark. It’s probably my favorite stock and if it hits 4.9% I’ll be adding. =) Like you.mentioned the strike really shows how important they are.
I like the bpy pick as well. I’ve been buying them a bit recently and they are my pick for roadmaps 2020 picks.
Anyways have a great new years.
Ya, I’ll probably add CNR to my RRSP next year and also buy some EMA, T and CAR.UN for my TFSA in the coming weeks.
Have a GREAT New Year yourself Rob!