Latest news with #ChrisMacDonald
Yahoo
20 hours ago
- Business
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How to Make Your $7,000 TFSA Contribution Work Harder This Year
Written by Chris MacDonald at The Motley Fool Canada The Tax-Free Savings Account (TFSA) investing vehicle is one of the best, and perhaps most under-utilized, tools available to Canadian investors. This account allows Canadian investors to put $7,000 in after-tax dollars to work in an investing account, with the corresponding growth and dividend income provided by the investments in this account eligible to be pulled out tax-free at any point in time. For those planning for retirement, having access to a tax-free chunk of capital when it comes time to retire is a big deal. That goes double for those who plan to work into retirement, and/or those who expect to have a higher tax burden down the line. With the way fiscal spending is trending everywhere, that's a bet many may be willing to make. Here are three tips investors looking to maximize the performance of their TFSAs may want to think about right now. Generally speaking, most financial planners would advise investors to first consider which types of investments they're thinking about including in their TFSA. A very high-growth stock such as Shopify (TSX:SHOP) or Constellation Software (TSX:CSU) that has seen rapid price appreciation in recent years would be disproportionately rewarded by being held in such a fund. That's simply due to the fact that such stocks have continued to compound over time, and that capital appreciation investors would have seen from investing in such stocks early on would have resulted in most of the value of their current holdings being in price appreciation. In a TFSA, this price appreciation is tax-free. That said, putting all of one's TFSA funds in one or two particular stocks is a strategy most financial experts would also be up in arms about. A TFSA does disproportionately benefit investors who want to pick growth stocks that perform well. The key is that such holdings need to perform, and there are no guarantees on this front. Thus, holding a broader basket of diverse growth stocks may be the optimal choice for most passive long-term investors. Whether it's a growth-focused ETF or mutual fund, supplementing single-stock picks is a strategy I'm personally in favour of, and it is a strategy I think most investors should consider. One of the problems with a TFSA (which is similar to a Roth 401(k) in the U.S.) is the relative ease at which investors can pull their capital out of a TFSA when needed. While liquidity is great (and that's a feature of this investment vehicle), in terms of saving for retirement, excessive withdrawals over time from a TFSA can really degrade the long-term value that can come from holding high-quality growth stocks in this account. As such, I think the prudent advice for most investors is to put whatever possible into a TFSA (preferably to the maximum allowed), and let these funds sit there for as long as possible. That's the advice most financial experts would provide, and it's easier said than done. But for those who are patient and willing to let their winners ride, this is the account that makes the most sense to do so. The post How to Make Your $7,000 TFSA Contribution Work Harder This Year appeared first on The Motley Fool Canada. More reading Made in Canada: 5 Homegrown Stocks Ready for the 'Buy Local' Revolution [PREMIUM PICKS] Market Volatility Toolkit Best Canadian Stocks to Buy in 2025 Beginner Investors: 4 Top Canadian Stocks to Buy for 2025 5 Years From Now, You'll Probably Wish You Grabbed These Stocks Subscribe to Motley Fool Canada on YouTube Fool contributor Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Shopify. The Motley Fool recommends Constellation Software. The Motley Fool has a disclosure policy. 2025
Yahoo
14-05-2025
- Business
- Yahoo
This Energy Stock Yielding 6% Could Double Your Money by 2027
Written by Chris MacDonald at The Motley Fool Canada Finding any energy stock with the sort of upside potential a doubling over the next three years would imply is difficult. But picking a company with a very robust dividend yield (and one which I think should eventually come down as the company's share price rises over time), it's entirely feasible to see the kind of 20% or so annual return that would be required to get to such a result. One of the top energy stocks I think has this kind of upside potential right now is Enbridge (TSX:ENB). The pipeline operator has seen rather impressive growth in recent years, as the chart below shows. However, I think there's still plenty of upside potential ahead, particularly if certain trends continue over the course of the next few years. Aside from the fact that ENB stock has already doubled over the course of the past five years, here's why I think Enbridge is one company many growth investors may be overlooking right now. One of the things I like about Enbridge's rise (shown above) is that there's about as strong of a fundamental basis for this move as in any company I look at right now. In fact, the company's first-quarter (Q1) report surged past expectations on most fronts. The company's revenue surged more than 22% on a year-over-year basis. This drove adjusted earnings to rise 12% (with Generally Accepted Accounting Principles earnings actually surging 43% over the same quarter the year prior) as the company ramped up its efficiency metrics and made operating efficiency a strategic priority and point of emphasis in terms of execution. Despite these strong earnings metrics, Enbridge's valuation remains very attractive. Shares of ENB stock trade at just 21 times forward earnings, putting this stock in value territory, at least in my books. Any company that can grow its earnings per share at twice the rate of its forward price-to-earnings multiple is one I want to consider in any environment. Of course, buying a stock that trades at half its forward growth rate is a great thing. But that given company will need to deliver on this expected growth moving forward. In the case of Enbridge, I think there are reasons for investors to remain confident in the company's ability to do just that. The company has reaffirmed its forward guidance, suggesting the company should produce between $5.50 and $5.90 per share in free cash flow. Over the long term, the company expects to produce mid-single-digit earnings growth. So, there may be some slowing, but not much over time. And given the predictable nature of the company's revenues (which are locked in due to long-term contracts with the company's key customers), this is a stock with plenty of upside potential over time, in my view. A doubling in value over the next three years is certainly possible — Enbridge has done this before and could do it again. If market conditions cooperate, I could see even higher returns over the next three years as a decent probability. The post This Energy Stock Yielding 6% Could Double Your Money by 2027 appeared first on The Motley Fool Canada. Before you buy stock in Enbridge, consider this: The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Enbridge wasn't one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years. Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the 'eBay of Latin America' at the time of our recommendation, you'd have $21,345.77!* Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 24 percentage points since 2013*. See the Top Stocks * Returns as of 4/21/25 More reading Made in Canada: 5 Homegrown Stocks Ready for the 'Buy Local' Revolution [PREMIUM PICKS] Market Volatility Toolkit Best Canadian Stocks to Buy in 2025 Beginner Investors: 4 Top Canadian Stocks to Buy for 2025 5 Years From Now, You'll Probably Wish You Grabbed These Stocks Subscribe to Motley Fool Canada on YouTube Fool contributor Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge. The Motley Fool has a disclosure policy. 2025 Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
30-04-2025
- Business
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Buy the Dip: 2 Top Canadian Stocks to Buy Right Now
Written by Chris MacDonald at The Motley Fool Canada The Canadian stock market has been an interesting place for investors over the course of the past year. Many of the country's top stocks have performed relatively well, all things considered. Tariff uncertainty has ravaged certain sectors, but there do happen to be a number of companies that have bucked this trend. But overall, it's true that most Canadian stocks are trading well off their peaks. What does that mean? Well, for those who are willing to hunt for deals, there are some sales of high-quality value stocks worth considering right now. Here are two of my top ideas in this current market that I think are worth considering. Shopify (TSX:SHOP) is Canada's pre-eminent tech darling. One of the most impressive growth stocks we've seen come out of Canada in some time, Shopify benefited from a surge in interest in the e-commerce sector around the time of the pandemic. Unfortunately, as investors can see from the chart above, this is a company that's since traded well off its pandemic highs. There's still a long way to go for Shopify to regain its previous valuation, but that means there's also plenty of upside potential there for investors who don't think this company's previous ascent was a fluke. Of course, I'm not suggesting that e-commerce activity will surge back to pandemic-era levels. However, I think Shopify's underlying growth (which remains strong, given its size) and the company's position in the global e-commerce space, in combination with Shopify's impressive market share, make this a stock worth considering on its most recent dip. Restaurant Brands (TSX:QSR) is another top Canadian stock I've been bullish on for a long time and one that's generally gone up and to the right in recent years. However, as the chart above shows, this is a stock that's down roughly 20% from its high, making QSR stock an attractive choice in my books for value investors looking for strong total returns over the long haul. Restaurant Brands's business model, which revolves around its fast-food offerings from Burger King to Tim Hortons, Popeyes, Firehouse Subs, and other banners, remains steady during most market environments. In fact, during previous recessions, we've seen sales and profit continue to increase for fast-food operators, making this company one of the more defensive picks for investors seeking safe harbour in this current environment. In my view, Restaurant Brands's long-term growth upside paired with this stock's 3.9% yield provides about as attractive of a long-term total return profile as there is in the market. Thus, I think long-term investors can buy this recent 20% dip with confidence and hold for the long term. Worst case, over the near term, investors are banking on a nearly 4% yield, so they can reinvest in this stock and watch it grow over time. That's not bad, in my view. The post Buy the Dip: 2 Top Canadian Stocks to Buy Right Now appeared first on The Motley Fool Canada. Before you buy stock in Restaurant Brands International, consider this: The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Restaurant Brands International wasn't one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years. Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the 'eBay of Latin America' at the time of our recommendation, you'd have $21,345.77!* Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 24 percentage points since 2013*. See the Top Stocks * Returns as of 4/21/25 More reading Made in Canada: 5 Homegrown Stocks Ready for the 'Buy Local' Revolution [PREMIUM PICKS] Market Volatility Toolkit Best Canadian Stocks to Buy in 2025 Beginner Investors: 4 Top Canadian Stocks to Buy for 2025 5 Years From Now, You'll Probably Wish You Grabbed These Stocks Subscribe to Motley Fool Canada on YouTube Fool contributor Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Shopify. The Motley Fool recommends Restaurant Brands International. The Motley Fool has a disclosure policy. 2025 Sign in to access your portfolio
Yahoo
24-04-2025
- Business
- Yahoo
Growth Stocks to Buy: 2 Canadian Gems That Look Poised to Soar
Written by Chris MacDonald at The Motley Fool Canada The market for Canadian growth stocks is one many investors may not be paying close attention to. There are a range of reasons for this, from the size of this market to the limited number of tech companies that tend to come out of Canada. However, that's not to say that a hotbed of innovation is not waiting for investors to pounce. For those willing to look outside of the U.S. for growth (and a newfound trend of global stocks picking up steam), there are a few top Canadian growth stocks I think are worth paying attention to right now. Here are two of my top picks I think could be poised to soar in 2025 and beyond. E-commerce platform provider Shopify (TSX:SHOP) remains roughly 50% below its pandemic highs. However, this is a stock that had some strong momentum heading into this year, before shares abruptly fell off a cliff in recent weeks as broader economic concerns appear to have begun to hit the e-commerce sector. I think these concerns are worth exploring from a number of angles. On the one hand, investors have reason to be concerned that online retail sales volumes could slow in a world where higher tariffs could mean less international trade (a big component of Shopify's overall model). On the other hand, domestic businesses looking to fill the hole previously occupied by such firms could offset some (or all) of this slowdown. That said, consumer spending worries are clearly being priced into various consumer-facing stocks. And given where Shopify is positioned, this concern is notable. Worth noting is, over the long term, there's reason to believe that more and more retail spending will take place on one's computer or smartphone. For those who still believe these underlying trends will remain robust, buying SHOP stock when it's beaten down like this could prove to be a smart move. That's the position I'm taking right now, and I think Shopify could be poised for a nice reversion rally when the clouds clear. I have no idea when that will be, but this is a stock that's a long-term position in my books. Another top tech giant in the Canadian market, Constellation Software (TSX:CSU), has a much prettier long-term chart to look at. As investors will notice, the company's performance over the past five years has been very orderly. The sort of up-and-to-the-right move long-term investors want to see is very visible with this company. That move is due to a number of factors which have contributed to very consistent earnings growth over the long term. Constellation's business model is based on a rather simplistic view that the software sector is one that can (and likely will) be consolidated over time. With a smaller number of companies owning a larger percentage of the overall ecosystem in the world of software and SaaS businesses, Constellation Software could be one of the true Canadian stalwarts in a sector that's currently dominated by U.S. companies. We'll have to see. But for now, I'm not the only bull on Constellation Software that thinks the same way. Despite a rather elevated valuation multiple, this is still a stock that's attracting strong inflows. And until the company's business model shows anything resembling cracks, I think this trend is likely to continue over time. The post Growth Stocks to Buy: 2 Canadian Gems That Look Poised to Soar appeared first on The Motley Fool Canada. Before you buy stock in Constellation Software, consider this: The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Constellation Software wasn't one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years. Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the 'eBay of Latin America' at the time of our recommendation, you'd have $21,345.77!* Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 24 percentage points since 2013*. See the Top Stocks * Returns as of 4/21/25 More reading Made in Canada: 5 Homegrown Stocks Ready for the 'Buy Local' Revolution [PREMIUM PICKS] Market Volatility Toolkit Best Canadian Stocks to Buy in 2025 Beginner Investors: 4 Top Canadian Stocks to Buy for 2025 5 Years From Now, You'll Probably Wish You Grabbed These Stocks Subscribe to Motley Fool Canada on YouTube Fool contributor Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Shopify. The Motley Fool recommends Constellation Software. The Motley Fool has a disclosure policy. 2025
Yahoo
16-04-2025
- Business
- Yahoo
Don't Sleep on These Growth Stocks With Incredible Historical Returns
Written by Chris MacDonald at The Motley Fool Canada The stock market is clearly in a state of turmoil right now. For Canadian stocks, this turmoil has been driven, at least in part, by tariffs put in place by the Trump administration. What happens on that front is anyone's guess. However, moving forward, investors who are thinking long term and looking for growth stocks to buy certainly have their work cut out for them. I do think there are some relatively attractive growth opportunities in Canada with the potential to whistle past the volatility. Here are two of my top ideas for investors looking to position their portfolios for growth right now. As far as Canadian software stocks are concerned, Constellation Software (TSX:CSU) remains my top pick in this space. There are many reasons for this, but looking at the company's stock chart below, it's clear that long-term investors have done well by doing, well, nothing but holding this name long term. I think that will continue to be the case over the long term, due mostly to Constellation's underlying business model. The company has grown to its massive size over time by implementing a growth-via-acquisition business model. What Constellation does is identify software companies with strong growth potential, acquire them before they grow too large, and utilize the company's size, scale, and network effects to take these companies to new heights. This model has resulted in very strong revenue growth of 20% this past year. Of course, organic growth is part of the story (with organic sales growing around 2% a year). That's not bad, and there's room for improvement. Accordingly, I think there's actually an argument to be made that Constellation could see revenue and earnings growth accelerate moving forward. Analysts continue to view Constellation as a moderate buy, but I think this is a stock that looks relatively attractive given its growth upside. Investors will need to pay up for this high-quality, growth with CSU stock trading around 94 times trailing earnings. But in this market, I think it makes sense to pay up for quality, and Constellation Software remains one of my top picks for this reason. Another top growth stock I continue to pound the table on is Boyd Group (TSX:BYD). The auto body repair company has also seen impressive long-term growth due to a similar underlying strategy. Rather than software companies, Boyd focuses on consolidating the still-fragmented auto body repair market. Boyd's business model is certainly less attractive than Constellation's in terms of the companies Boyd focuses on acquiring. But both companies have interestingly produced similar long-term growth rates, and that's reflected in Boyd's long-term stock chart above. Boyd's 15% revenue growth rate in past quarters is certainly impressive for the industry it operates in, and this is a stock that analysts are also bullish on. Boyd has a consensus buy rating and significant upside over the near to medium term, at least according to the experts. I think they're right on this one, given the company's ability to continue growing by acquiring a larger number of large targets over time. That's supported by a solid balance sheet and debt-to-equity ratio of 0.75. So long as folks continue to drive their cars longer (seeking more repairs), companies like Boyd should be a winner from a potential continued downturn moving forward. That fact alone positions this company as a top defensive growth stock to buy now, in my view. The post Don't Sleep on These Growth Stocks With Incredible Historical Returns appeared first on The Motley Fool Canada. Before you buy stock in Boyd Group Income Fund, consider this: The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Boyd Group Income Fund wasn't one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years. Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the 'eBay of Latin America' at the time of our recommendation, you'd have $20,697.16!* Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 29 percentage points since 2013*. See the Top Stocks * Returns as of 3/20/25 More reading Best Canadian Stocks to Buy in 2025 Market Volatility Toolkit 4 Secrets of TFSA Millionaires Beginner Investors: 4 Top Canadian Stocks to Buy for 2025 5 Years From Now, You'll Probably Wish You Grabbed These Stocks Subscribe to Motley Fool Canada on YouTube Fool contributor Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool recommends Boyd Group Services and Constellation Software. The Motley Fool has a disclosure policy. 2025
