Best TSX Stock to Buy for $1,000 Right Now

Starting with $1,000 is a fantastic way for Canadians to dive into investing. Even with that amount, compound interest can do wonders over time. For example, at 7% annual returns, $1,000 could grow to almost $7,600 over 30 years. That’s a solid starting point for building wealth, and as you add more to your investments, the growth can really take off. Here are the best investments I’d consider.

How to choose stocks

When choosing stocks, Canadians should look for companies with solid fundamentals, a history of steady growth, and a reliable dividend payout. Dividend-paying stocks in particular offer the dual benefits of regular income and capital growth. In addition, focusing on industries that demonstrate long-term resilience, such as utilities, financials, or consumer staples, can help create a more balanced and stable portfolio.

Growth stocks are also a great option for those willing to take on a little more risk. These stocks typically reinvest their profits into expanding their operations rather than paying dividends. As these companies grow, their stock value also increases, potentially offering significant gains over the long term. Whether you’re looking for dividends or growth, diversifying across sectors and risk profiles is key to maximizing your returns.

Consider BAM stock

Brookfield Asset Management (TSX:BAM) on TSX is a good choice for investors looking for both growth and stability. Known for its world-class management team, BAM has a long history of delivering value to shareholders. The firm specializes in alternative asset management, investing in real estate, infrastructure, and renewable energy. BAM’s management has a proven ability to navigate market cycles, making it a reliable choice for Canadians looking for a safe investment.

BAM’s financial strength is another reason it stands out. With a market capitalization of $24 billion and a 52-week price change of 20.5%, the company has demonstrated consistent performance. Its forward dividend yield of 3.4% at the time of writing provides investors with a solid income stream. The company’s ability to generate returns for shareholders, combined with its strong leadership, makes it a great long-term play in the asset management space. As one analyst said, “Brookfield has a knack for finding value where others don’t, and it consistently delivers it.”

On the earnings side, BAM continues to show strong momentum. Its return on equity (ROE) of 16.1% demonstrates the efficient use of investor capital, while quarterly earnings growth of 13.8% year-over-year underscores its ability to consistently grow earnings. With a price-to-earnings (P/E) ratio of 41 and a forward P/E of 23, BAM is positioned for continued growth. While its valuation may seem high, it reflects the company’s status as a premium company in the world of asset management.

Summary

For Canadians looking to invest their $1,000, BAM offers a combination of dividend income and growth through capital appreciation. Starting with $1,000 is a great way for Canadians to start investing, and focusing on strong, reliable stocks like BAM can point you in the right direction. With solid leadership, strong earnings momentum, and a steady dividend yield, BAM offers both growth potential and stability. Whether you’re looking for income or capital appreciation, BAM is a safe and smart choice for long-term investors looking to steadily increase their wealth.