The Best Stocks to Invest $50,000 in Right Now (2024)

Aditya Raghunath

April 28, 2023 at 10:00 a.m.·3 min read

The Best Stocks to Invest $50,000 in Right Now (1)

Written by Aditya Raghunath at The Motley Fool Canada

Investing can be tricky, given the number of asset classes individuals are exposed to. You can invest in stocks, mutual funds, exchange-traded funds, gold, bonds, real estate, and even cryptocurrencies. However, over the long term, stocks have consistently delivered inflation-beating returns and created massive wealth for investors.

The ongoing pullback in share prices and volatility surrounding the equity market provides you a chance to generate stellar returns once investor sentiment improves.

Tech stocks such as Snowflake

Investors can consider buying shares of beaten-down growth stocks, such as Snowflake (NYSE:SNOW), that are trading at lower multiples in April 2023. While Snowflake stock is down 63% from all-time highs, it is well poised to grow revenue and earnings at a rapid clip in 2023 and beyond.

The company ended fiscal 2023 with remaining performance obligations of over US$3.6 billion and close to 8,000 enterprise customers. Snowflake’s dollar-based net retention rate stood at 158%, suggesting existing clients increased spending by 58% in the last four quarters.

Moreover, Snowflake has estimated its total addressable market to touch US$248 billion by 2026, allowing it to grow sales at a consistent pace in the near term. In fiscal 2023, its sales stood at just over US$2 billion.

Blue-chip stocks such as Toronto-Dominion Bank

Investing in dividend-paying, blue-chip stocks is always a sound strategy, as you can benefit from a steady stream of passive income as well as capital gains. One such TSX stock is Toronto-Dominion Bank (TSX:TD), which currently offers a dividend yield of 4.7%.

In the last 20 years, TD stock has returned 905% to investors after adjusting for dividends, showcasing the resiliency of the banking giant. In this period, it has managed to navigate through several economic downturns, including the dot-com crash, the financial crisis, the COVID-19 pandemic, and the current bear market.

High dividend stocks such as Enbridge

Investors can also consider investing in high-dividend stocks such as Enbridge (TSX:ENB). An infrastructure giant, Enbridge offers you a dividend yield of 6.7%, which is quite tasty.

In the last 28 years, Enbridge has increased its dividends by 10% annually, which is remarkable for a cyclical company. A majority of its cash flows are backed by inflation-linked, long-term contracts, making the company relatively immune to fluctuations in commodity prices.

In recent years, Enbridge has also expanded its base of renewable energy assets, and this segment now accounts for 3% of adjusted EBITDA (earnings before interest, tax, depreciation, and amortization).

Undervalued growth stocks such as Neighbourly Pharmacy

Undervalued growth stocks such as Neighbourly Pharmacy (TSX:NBLY) have the potential to deliver game-changing returns over time. Part of a recession-resistant sector, Neighbourly Pharmacy is focused on acquiring retail pharmacies in underserved Canadian regions.

The stock is priced at one times 2024 sales and 27 times forward earnings, which is very reasonable for a quality growth stock. Further, its improving profit margins also allow NBLY to pay shareholders an annual dividend of $0.18 per share, indicating a yield of 0.9%.

Analysts tracking NBLY stock expect shares to surge over 40% in the next 12 months.

The post The Best Stocks to Invest $50,000 in Right Now appeared first on The Motley Fool Canada.

Should You Invest $1,000 In Snowflake?

Before you consider Snowflake, you'll want to hear this.

Our market-beating analyst team just revealed what they believe are the 5 best stocks for investors to buy in April 2023... and Snowflake wasn't on the list.

The online investing service they've run for nearly a decade, Motley Fool Stock Advisor Canada, is beating the TSX by 21 percentage points. And right now, they think there are 5 stocks that are better buys.

See the 5 Stocks * Returns as of 4/18/23

More reading

Fool contributor Aditya Raghunath has positions in Enbridge. The Motley Fool recommends Enbridge and Snowflake. The Motley Fool has a disclosure policy.

2023

As an expert in the field of investing, particularly in stocks and financial markets, I can confidently analyze the key concepts discussed in the provided article by Aditya Raghunath at The Motley Fool Canada.

Asset Classes and Investment Options: The article highlights the variety of asset classes available for investment, including stocks, mutual funds, exchange-traded funds (ETFs), gold, bonds, real estate, and cryptocurrencies. It emphasizes the long-term track record of stocks in delivering inflation-beating returns.
Current Market Conditions and Investor Sentiment: Raghunath discusses the ongoing pullback in share prices and the volatility in the equity market, suggesting that these conditions present an opportunity for investors to generate stellar returns when investor sentiment improves.
Stock Recommendations: The article provides specific stock recommendations for investing $50,000, covering different types of stocks:

a. Tech Stocks - Snowflake (NYSE: SNOW):
- Highlights the potential of beaten-down growth stocks like Snowflake, which is trading at lower multiples.
- Despite being down 63% from all-time highs, Snowflake is expected to grow revenue and earnings rapidly in 2023 and beyond.
- Key financial indicators such as remaining performance obligations, enterprise customers, and dollar-based net retention rate are mentioned to support the investment thesis.
b. Blue-Chip Stocks - Toronto-Dominion Bank (TSX: TD):
- Advocates for investing in dividend-paying, blue-chip stocks for a steady stream of passive income and capital gains.
- Toronto-Dominion Bank is highlighted for its 4.7% dividend yield and a resilient performance over the past 20 years, navigating through various economic downturns.
c. High-Dividend Stocks - Enbridge (TSX: ENB):
- Recommends considering high-dividend stocks like Enbridge, an infrastructure giant with a 6.7% dividend yield.
- Emphasizes the company's history of annual dividend increases, supported by inflation-linked, long-term contracts.
d. Undervalued Growth Stocks - Neighbourly Pharmacy (TSX: NBLY):
- Suggests investing in undervalued growth stocks like Neighbourly Pharmacy, which focuses on acquiring retail pharmacies in underserved Canadian regions.
- Highlights the stock's reasonable valuation (one times 2024 sales and 27 times forward earnings), improving profit margins, and the potential for game-changing returns.
Analyst Expectations: The article mentions analyst expectations for Neighbourly Pharmacy (NBLY) stock, projecting a potential surge of over 40% in the next 12 months.
Market Analysis and Expert Opinion: The article provides a market overview and expert opinion, endorsing the mentioned stocks such as Snowflake, Toronto-Dominion Bank, Enbridge, and Neighbourly Pharmacy.

In conclusion, the article offers a comprehensive guide for investors looking to allocate $50,000, combining a mix of growth stocks, blue-chip stocks, and high-dividend stocks to create a diversified investment portfolio. The recommendations are supported by analysis, financial indicators, and expert insights.