Long-term investing is a prudent strategy that allows investors to benefit from the power of compounding while providing protection against short-term fluctuations. Recent data released by the United States Bureau of Labor Statistics revealed that the producer price index, which measures wholesale prices, increased by 0.1% in July compared to June, falling below analysts’ expectations of 0.2%. This lower-than-expected inflation has sparked hopes of interest rate cuts and alleviated concerns about a potential recession. Consequently, the TSX/S&P Composite Index experienced a 1% increase yesterday and has gained 8% year-to-date.
In light of improving investor sentiment, here are three promising stocks that investors can consider holding for the next 20 years to potentially generate significant returns.
An impressive performer this year has been a Canadian company that has outperformed the broader equity markets with returns exceeding 20%. This company’s solid quarterly performances, optimistic guidance for the next three years, and strategic initiatives have bolstered investor confidence, driving the stock price upwards. The company holds a small portion of the Canadian subprime market, providing ample opportunities for expansion. With diversified product offerings, strong distribution channels, and a robust digital infrastructure, this company is well-positioned for growth in Canada and beyond. Additionally, the recent interest rate cuts by the Bank of Canada have positive implications for this company’s growth potential, making it an attractive long-term investment.
Another notable performer this year is a Canadian waste management company that has delivered a return of over 25% year-to-date. The company’s strategic acquisitions, anticipated revenue contributions, and ongoing focus on organic growth through facility construction are expected to drive continued financial success. With a solid management team focused on expansion and revenue growth, this company presents a compelling investment opportunity for long-term investors.
Lastly, a midstream energy company has garnered a return of 17.6% year-to-date, driven by falling interest rates and strong second-quarter performance. Through strategic acquisitions and a comprehensive capital program, this company aims to diversify its operations and improve cash flow stability. With a track record of consistent dividend growth and an attractive forward yield, this company offers long-term income potential for investors.
In conclusion, these three stocks represent promising investment opportunities for long-term investors seeking sustainable growth and attractive returns over the next two decades.
