Investors looking to put their next $1,000 to work currently have plenty of options to choose from. Of course, the stock market is a great place for investors to consider putting capital to work over the long term. Equities have shown higher returns over the very long term and provide protection against inflation for people who want to increase their standard of living over time and have an enjoyable retirement.
That said, given current interest rates, there are plenty of other options to consider in the fixed income world. Whether we are talking about bonds or other alternative assets, it is true that there are some viable alternatives on the market now.
That said, finding the right dividend stocks that fit one’s personal risk tolerance and return goals can be a meaningful tool for those investing for retirement or other long-term goals.
Here are two top TSX stocks that I would put in the no-brainer bucket for those looking to invest now.
Manulife financial
Regardless of your personal feelings about where the market will go in the short term (e.g., a year or less), in the long run, insurance companies have proven to be a solid long-term bet. Manulife financial (TSX:MFC) is one such company that I’ve been harping on over the past few years, and it turned out to be a good choice.
Much of my earlier bullish call on Manulife had to do with the fact that this stock has been inherently undervalued for some time. While some of this valuation gap has disappeared, MFC shares still trade at a price-to-earnings ratio of just fifteen times earnings.
Compared to where the market is trading today, that seems like a very reasonable multiple for a company that is still in growth mode (and has a 3.7% dividend yield).
Shopify
We move to the other end of the risk/reward spectrum, Shopify (TSX:SHOP) has certainly been a much more volatile name than Manulife in recent months and years, as the chart below shows.
That said, I’d say this volatility is probably justified given Shopify’s higher growth rate and its ability to blow away profits (or massively disappoint the market).
I think long-term investors can take comfort in the fact that Shopify has some very robust underlying growth catalysts supporting its valuation. In the long term, I believe e-commerce sales will account for an increasing percentage of the overall market, with Shopify providing the key technology infrastructure to support this movement.
If you’re in this camp, I think Shopify still makes sense to add, even at current levels. Personally, I’d like to see a little more pushback before I pull the trigger. But I think this is a company that can easily reach new all-time highs over time and continue to grow in a way that few other TSX growth stocks can.
#Easy #Stocks #Buy