2 Top Canadian Energy Stocks to Buy and Hold Forever
The Motley Fool
Published Nov 14, 2021 12:30
Updated Nov 14, 2021 12:45
2 Top Canadian Energy Stocks to Buy and Hold Forever
Investors looking for top energy stocks for exposure right now really have their work cut out for them. What was once a deep-value sector is starting to look fairly valued. Dividend yields are down, as the stock prices of many of these energy players continue to take off.
For those invested in the space, that’s not such a bad thing. However, for investors looking to put fresh capital to work, this environment can be a difficult one to operate in.
That said, there remain some great long-term investing options at these levels. Here are two of my top picks right now in the energy sector.
Top energy stocks: Northland Power One of the top energy stocks I’m looking at right now is Northland Power (TSX:NPI). Unlike most traditional energy stocks that investors look at, Northland Power primarily focuses on generating clean and green power.
Indeed, this Toronto-based company has a global portfolio of assets. Northland’s portfolio includes natural gas-based power plants, solar farms, and onshore and offshore wind farms. The major focus of Northland Power is on the offshore wind asset class.
Having a green portfolio of assets is an attractive feature for a stock you plan to hold for the long term. Along with this, NPI also pays a monthly dividend. Currently, this stock yields a reasonable 3.1% at the time of writing.
Northland Power has been a top-notch growth stock in the past. Indeed, this is also a company with a great growth strategy moving forward. Accordingly, I remain bullish on Northland as a clean energy holding right now.
Enbridge Among the energy stocks I’m keeping an eye on right now is Enbridge (TSX:ENB)(NYSE:ENB). This company isn’t only attractive from a yield perspective. (A 6.3% yield is certainly worth considering). Rather, Enbridge is an energy stock with excellent capital-appreciation potential from here as well.
On a relative basis, Enbridge’s yield remains high. Should the company continue to raise its dividend in the years to come, as the company says it will, this is a stock that should move higher alongside its dividend distributions.
Enbridge’s core pipeline business provides a steady stream of cash flows to fund its growth projects, as well as its dividend. Accordingly, I view Enbridge as a stable long-term holding for investors seeking a high-yielding option in the energy space.
The company’s recent results further this thesis. The company produced $1.2 billion in adjusted earnings compared to $1 billion the year prior. A 20% growth rate on the bottom line is meaningful. Additionally, the company’s distributable cash flow swelled to $2.3 billion, from $2.1 billion the year prior. This is the metric that many investors look to, with regards to Enbridge being able to make good on its commitments to shareholders.
Get The App
Both Enbridge and Northland provide investors with an excellent mix of yield and capital-appreciation potential. Accordingly, these two energy stocks ought to make every investor’s watch list right now.
The post 2 Top Canadian Energy Stocks to Buy and Hold Forever appeared first on The Motley Fool Canada.
Fool contributor Chris MacDonald owns shares of ENBRIDGE INC. The Motley Fool recommends Enbridge.
This Article Was First Published on The Motley Fool
Written By: The Motley Fool
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.