Recently, I read some articles that discussed what Desjardins Securities, RBC Dominion Securities, BMO Capital Markets and other gurus thought would be some top stocks to own for 2017. From those articles here are some of the stocks they recommended and my amateur commentary on them.
- Manulife (MFC) – already own it and no intention of selling. It has long been a core holding of top Canadian equity ETF XIU. As long as people need insurance this should be a long-term dividend machine. (Disclosure will hold.)
- Sun Life Financial (SLF) – as above. (Disclosure will hold.)
- Bank of Nova Scotia (BNS) – stellar dividend history and with interest rates on the rise, over time, that will mean more cash to investors. International operations also help diversification. (Disclosure will hold.)
- Dollarama (DOL) – I’m kicking myself on this one, I was tempted to buy it years ago when the price was close to $30. The price is now approaching $100.
- Husky Energy (HSE) – although a major player in the oil and gas industry, I try to avoid stocks that have a fickle dividend and price history. This is one of them.
- Enerplus (ERF) – this company is highly dependent upon oil and gas exploration thriving in Canada. Too cyclical for me.
- Pembina Pipeline (PPL) – a toll road for oil and gas. Perfect. (Disclosure will hold.)
- Suncor (SU) – it has long been a core holding of top Canadian equity ETF XIU. It is too big to fail? (Disclosure will hold.)
- Goldcorp (G) – I have no idea where gold prices are going. This could be a great pick or a dog.
- Smart REIT (SRU.UN) – owners of retail shopping buildings, with dozens of box-store tenants who lease this space in both urban and suburban areas. This should be a cash cow for many years to come. (Disclosure will hold.)
- Alimentation Couche-Tard (ATD.B) – one of the largest company-owned convenience store operators in the world. Likely a good long-term hold for capital appreciation, including starting in 2017 and beyond.
- Brookfield Asset Management (BAM.A) – a massive conglomerate of real estate, infrastructure, renewable power and private equity. Likely a long-term winner. Another core holding for many Canadian equity ETFs.
- Magna International (MG) – a global automotive parts supplier. Even with self-driving cars on the way, it might thrive.
- National Bank of Canada (NA) – they now offer commission-free ETFs. Great news for investors and so are their long-term dividends. Another core holding of top Canadian equity ETF XIU. (Disclosure will hold.)
- TransCanada (TRP) – another energy toll road. Consistently a top holding of many Canadian equity ETFs including XIU. (Disclosure will hold.)
- Fortis (FTS) – a company that has raised their dividend every year, for 40+ years. A utility cash cow and core holding for me. (Disclosure will hold.)
- Algonquin Power & Utilities (AQN) – with a heightened focus on renewable energy in the coming years, another stock that is poised to deliver returns to investors. (Disclosure will hold.)
- InterRent REIT (IIP.UN) – this company comprised of multi-residential properties is expected to rise in value thanks to home ownership becoming a dream for some people.
- Cineplex (CGX) – analysts are saying people are loving the movies more and more, even with $5 popcorn.
- Canadian Natural Resources (CNQ) – this stock is widely held across many Canadian equity ETFs.
- West Fraser Timber (WFT) – the demand of timber and wood products is expected to rise in 2017 by many analysts. Will it happen?
A BIG disclaimer these stocks are not recommendations for purchase. Far from it. Please consult your financial professional before making any major investment decisions for you or your family. Any of these stocks could turn out to be studs or duds in 2017. I do believe however based on this plan, buying and holding a few blue-chip Canadian dividend stocks long-term is a good recipe for financial success.
What Canadian stocks might you have your eye on in 2017? Or when in doubt are you indexing?
Good stuff Mark
Having traded down in the last couple years, I have been purchasing the same general boring stocks and done ok. I will not be selling ever so hopefully my kids like them. The market is high so I am in no rush. I am considering an etf in Canadian funds to cover the US and International market non-registered. Any ideas?
Always good to hear from you Doc.
Hopefully your kids will appreciate what you have started 🙂
An ETF in CDN funds to cover US and International markets in a non-reg. account eh? Humm…well, you probably want a low-dividend/distribution payer then right focusing on capital gains right? Be mindful of the withholding tax – although that is recoverable.
Maybe VUN for the U.S.?
Maybe VXC for the international play?
Again, these types of list are geared to Looking for new stocks, Buying and hoping fro future growth. When I was in the accumulation phase (and after I discovered DG investing), I had developed a list of stocks which met my buying criteria and those were the one I concentrated on, ignoring all others The ideas was to buy shares of those stocks when there was a price drop sufficiently to meet my buy level.
Certainly I would miss out on some stellar growth stocks, but my objective was Income Growth from a select group of good DG stocks. If the income was growing, so would price at some point.
Agreed cannew – re: if the income was growing, and the company has enough funds to continually raise its dividend, chances are you’re going to get price appreciation as well – a dual benefit. It’s not always the case, depending on the timeline you are looking at, but it can certainly happen over time. That’s a great thing.
Wow, it seems like you have a crystal ball and can see into part of my portfolio. This is a good dividend list. Here is what I have on your list: Manulife (MFC), Bank of Nova Scotia (BNS), Husky Energy (HSE), Pembina Pipeline (PPL), Smart REIT (SRU.UN)
Incidentally, I am also kicking myself for looking at Dollarama (DOL) and doing noting to pull the trigger. I may have to be brave some time this year and just buy it.
Good to hear from you Leo.
The low-yield stocks are hard for me (DOL)….they have capital gains upside for sure but I have a bias to getting paid – so I like the stocks that are within the range of 3-5% yield.
Good to hear from you Dining. I looked at your site, similar (but not surprising) holdings.
As I wrote back to RBull, I believe CDN banks, lifecos, telcos, REITs, utility companies are largely here to stay in Canada. We are a country of oligopolies and that will be tough to change over time.
I probably won’t invest in any low-yield stock directly, I might as well index if so – since XIU (for an example) pays 3% yield for the foreseeable future and is very tax efficient (and includes Couche-Tard (ATD.B)).
Good luck with your investments in 2017.
Interesting post Mark. Your “amateur” commentary is likely worth at least as much as the “expert” ones. Some of these will be winners and some will be losers in 2017. I think what matters is where they will be in 2027 (and beyond) and what they produce in dividends over that time as well. Good reply DiningOnDividends. I agree with both of you about blue chip dividend stocks.
Successful DIY investors have to do their own stock research, based on their long term goals and strategy.
As you know I’m ultra-boring when it comes to investing now. I buy blue-chip stocks or I index invest – and both approaches are meeting our goals. At the end of the day as long as you are meeting your financial goals – that is what matters. No two portfolios are exactly the same and they shouldn’t be – but there can be some common elements.
If CDN banks AND telcos AND utilities and REITs all go under – this country is doomed and all the indexers who invest in Canada go down with the ship as well.
I honestly hope that never happens of course!! I do think we’ll get a correction at some point – Mr. Market is always fickle!
Boring here too. Meeting goals -sure- I think you know where I stand on that.
Those sectors are VERY unlikely to go under (at least well into the foreseeable future), but for possible added insurance investors can diversify elsewhere too.
Guaranteed, we will get a correction. When and how much….who knows??
Yes, I know where you stand 🙂
I actually look forward to the correction. Granted, on paper I’ll be hitting broke haha but it’ll open up the door to some good deals (unlike the nonsense I’m seeing lately!). Buy cheap, sit tight and watch the market return on its upside path.