Investing with a two-decade outlook is one of the most reliable ways to build wealth. Time amplifies the effects of compounding — reinvested dividends and sustained share-price growth can transform even modest investments. With that long-term mindset, here are two exceptional TSX stocks that look poised to deliver steady gains well into the future.
Also Read: Best Canadian Stocks for Dividends
Toromont
Toromont Industries (TSX:TIH) is a premier Caterpillar dealer operating across Canada and parts of the U.S., supplying heavy equipment, parts, and services for construction, mining, energy, and infrastructure projects. These industries underpin economic activity and generate consistent, recurring demand. Even when project activity slows, equipment still needs repairs and maintenance, making Toromont’s revenue stream highly resilient.
The company’s financial record reinforces that stability. Over the past decade, Toromont has produced consistent double-digit earnings growth, raised its dividend year after year, and maintained one of the strongest balance sheets in the industrial sector. With minimal debt and strong free cash flow, the company is well positioned to reinvest, pursue acquisitions, and continue rewarding shareholders.
Looking ahead, Toromont stands to benefit from major infrastructure investments across Canada and rising spending on utilities, transportation, and energy systems. Structural trends such as electrification and renewable energy development also point to decades of equipment demand. Although the current yield is modest at roughly 1.3%, the company’s commitment to steady dividend growth makes it an excellent long-term compounder.
Also Read: Undervalued Canadian Stocks
ATS
ATS (TSX:ATS) is a global automation leader, providing high-tech systems used in life sciences, automotive manufacturing, clean energy, semiconductors, and other rapidly growing industries. As companies worldwide accelerate their shift toward automation — whether for EV production, medical manufacturing, or renewable energy components — ATS is positioned at the centre of this transformation. Its service, maintenance, and upgrade contracts further add a recurring revenue stream.
Backed by over a decade of steady revenue and earnings growth, ATS has demonstrated disciplined execution and strong acquisition strategy. Its expanding margins, solid balance sheet, and increasing free cash flow give the company the tools to scale its global presence and pursue long-term growth.
Despite its strong fundamentals, ATS remains undervalued compared with many industrial peers. Trading at roughly 21.7 times earnings, the stock offers compelling value considering its exposure to a long-running automation megatrend and its sizeable order backlog.
Bottom Line
Both Toromont and ATS are ideally positioned to capitalize on major themes like electrification, infrastructure expansion, and global automation. For investors seeking reliable long-term growth and rising income over the next 20 years, these two TSX stocks stand out as outstanding buy-and-hold candidates.
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