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Starting an Investment Portfolio? Buy These 3 Stocks!

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Written by Jed Lloren at The Motley Fool Canada

Getting your start in the stock market can be very intimidating. There are so many things to consider. For example, investors should be aware of how a certain company makes money, which companies stand as competitors, and how the economic conditions will affect business moving forward. Fortunately, there are many resources like The Motley Fool that can help steer you in the right direction. In this article, I’ll discuss three stocks that new investors should consider buying today.

This would be an excellent stock for your portfolio

As a new investor, you should focus on companies that are recognizable and lead an important industry. As an added bonus, new investors should look at dividend stocks. This is because dividend stocks tend to be more established than growth-minded counterparts. This could provide stability during periods of economic uncertainty. One company that satisfies all of those conditions is Canadian National Railway (TSX:CNR)(NYSE:CNI).

With nearly 33,000 km of track, Canadian National operates the largest railway network in Canada. A renowned dividend stock, Canadian National has managed to increase its dividend distribution in each of the past 25 years. That makes it one of only 11 TSX-listed companies to reach that milestone. Although it has managed to increase its dividend over so many years, Canadian National maintains a relatively low dividend-payout ratio (37.7%). That suggests that the company could continue to comfortably increase its dividend over the coming years.

Choose this steady business

Investors should also consider buying shares of Metro (TSX:MRU). If you live in Ontario or Quebec, there’s a very good chance that you’ll have seen one of this company’s stores near you. It operates more than 900 locations in Ontario and Quebec. What’s interesting is this company doesn’t operate under only one name. Of course, it has its namesake Metro locations. However, it also operates under the Food Basics, Super C, and Marché Richelieu banners.

Another excellent dividend stock, Metro is listed as a Canadian Dividend Aristocrat. This means that it has managed to increase its dividend in at least five consecutive years. Like Canadian National, it’s one of 11 companies to successfully increase its dividend distribution for the past 25 years. Grocery companies are excellent stocks to hold during times of economic uncertainty, because consumers will continue to require groceries regardless of what the economy looks like. Metro would make a great addition to your portfolio.

A company that deserves more attention

Finally, consider adding Alimentation Couche-Tard (TSX:ATD) to your portfolio. Like Metro, this company operates under a number of different banners. This includes Mac, Couche-Tard, Circle K, and On the Run. Alimentation Couche-Tard is also affiliated with several other brands. In total, this company operates about 14,000 stores across 15 different countries.

Like the previous two companies discussed in this article, Alimentation Couche-Tard is listed as a Canadian Dividend Aristocrat. It has managed to increase its dividend in each of the past 11 years. What’s impressive about this company is how fast it has managed to increase its dividend in those years. In fact, even just looking at the past five years, investors can see that its dividend has grown at a CAGR of 19.8%. That means that Alimentation Couche-Tard’s dividend grows at a faster rate than inflation, which should be appealing to investors.

The post Starting an Investment Portfolio? Buy These 3 Stocks! appeared first on The Motley Fool Canada.

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Fool contributor Jed Lloren has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alimentation Couche-Tard Inc. The Motley Fool recommends Canadian National Railway.


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