Investing in high-quality Canadian shares with strong development prospects can generate important positive factors in the long run. Nevertheless, you will need to purchase basically sturdy shares with sturdy financials, dependable enterprise fashions, and secular tailwinds. These shares usually tend to provide above-average returns.

So, if you happen to plan to speculate $500, these dead-easy Canadian shares have strong long-term potential.

Hydro One inventory

Hydro One (TSX:H) is a strong Canadian inventory providing a mixture of development, earnings, and stability. The main utility firm operates a defensive enterprise mannequin centered on regulated electrical energy transmission and distribution. These areas are largely shielded from the dangers of energy technology and commodity worth swings. This secure setup ensures predictable earnings and regular money circulation, which, in flip, helps its share worth and dividend development.

Over the previous few years, Hydro One’s efficiency has been spectacular. The inventory has gained greater than 76% in worth within the final three years and over 100% previously 5 years. Since 2016, the corporate has steadily elevated its dividend, because of its low-risk earnings and increasing fee base. From 2016 to 2022, its dividends grew at a compound annual development fee (CAGR) of 5%, accelerating to six% yearly from 2022 onward.

Wanting forward, Hydro One is well-positioned for continued development. Its fee base is projected to increase by 6% yearly via 2027, driving earnings at a CAGR of 6-8% over the identical interval. This can assist Hydro One to extend its dividend by 6% yearly within the medium time period.

With a powerful steadiness sheet, dependable money flows, and a disciplined capital-allocation technique, Hydro One stays well-equipped to fund development alternatives whereas sustaining its low-risk profile. Moreover, growing electrical energy demand, pushed by inhabitants development and the growth of information centres, gives additional upside potential.

MDA House inventory

MDA House (TSX:MDA) is one other compelling inventory to purchase now. Shares of this area know-how firm have misplaced appreciable worth within the latest previous after EchoStar abruptly cancelled a multi-billion-dollar satellite tv for pc contract and bought its spectrum licenses to SpaceX. Nevertheless, the corporate’s fundamentals stay strong, and it’s prone to profit from the growth of the area economic system. Additionally, it maintains a strong backlog, and administration reiterated full-year steerage. All these point out that the latest dip in MDA House inventory is a strong shopping for alternative.

Regardless of the latest pullback, MDA House inventory continues to be up over 423% in three years, and the rally is much from over. Even excluding the EchoStar deal, the corporate maintains a considerable $4.6 billion backlog, which presents visibility over future income development. Additional, the momentum in its companies, together with Satellite tv for pc Techniques, Robotics & House Operations, and Geointelligence divisions, will possible maintain as governments and personal enterprises ramp up investments in satellite tv for pc communications, defence applied sciences, and earth statement.

With rising international demand for space-based options, MDA’s diversified portfolio and cost-competitive choices place it to profit from these traits. Furthermore, its sturdy steadiness sheet offers it the pliability to spend money on innovation and seize new alternatives.