Market Crash: 2 TSX Stocks I’ve Doubled Down On

A stock market crash can bring a lot of quality opportunities for long-term investors who have the cash to invest, such as these two top TSX stocks.

| More on:
Modern buildings in business district

Image source: Getty Images

This market crash has been a great time for Canadian investors to buy TSX stocks. Many companies’ valuations have come down dramatically, offering long-term investors an attractive entry point.

But with so many stocks trading undervalue, where should you look to find stocks you want to buy?

The world’s greatest investor, Warren Buffett, has given advice on this before. He’s said that when looking to buy companies, you should always start with your own TSX stocks first. After all, if you wouldn’t be a buyer of the stocks you own today, then you should rethink why you own them in the first place.

Obviously, you may need some diversification or seek to grow the weighting of an industry you may be underweight in. If not, start with your own stocks first.

That’s what I have been doing over the last few weeks. In addition to adding a couple of new businesses that I have been watching for a while, I also doubled down on a few positions.

Consumer defensive TSX stock

The first TSX stock I bought more shares of is North West Company (TSX:NWC). North West owns grocery stores and supermarkets in remote communities in Northern Canada, Western Canada, Alaska and the Caribbean.

Consumer staples are some of the best investments you can own in a recession, and the fact that North West supplies entire communities, gives it an even stronger position.

The defensive TSX stock is a well-run, integrated company that pays a stable and reliable dividend, which is part of the reason why it’s such an attractive business to own ahead of a recession.

And with the discount in the share price, investors can buy North West today and receive a current yield on its dividend of roughly 6%.

In addition, the stock is trading at just 13.2 times its trailing earnings at a share price of just $22.

For me, the discount was too attractive to pass on, and I was happy to increase my position. This gives my portfolio additional stability and increases the total dividend yield. For investors considering a consumer staple TSX stock to buy, I’d definitely recommend North West.

TSX energy stock

Another TSX stock I’ve bought more shares of is Suncor Energy Inc (TSX:SU)(NYSE:SU).

With the collapse in oil prices, many energy stocks have become extremely cheap, giving long-term investors a major opportunity to gain exposure.

In such times, I prefer to buy the big blue-chip TSX stocks, which is why I chose an integrated company like Suncor.

These companies tend to trade at premiums during positive economic times, and will be the first stocks to rally when investor sentiment begins to return to markets. Not to mention, Suncor is one of the top businesses in Canada.

While these share prices can be somewhat justified by the current price of oil, the current price of oil is unsustainable. It’s therefore inevitable that Suncor shares should be worth more from here.

If any stock was built to handle a situation like this, it would be Suncor. Its integrated operations and high-quality management combine to make it one of the most reliable energy stocks in Canada.

That’s why I had no problem increasing my position in Suncor. I’m not concerned about short-term issues, and I know long-term the stock is easily worth $40 and can return cash to me in the meantime.

Bottom line

For investors contemplating getting into markets, now is by far the best time to be buying TSX stocks.

Both these stocks are long-term investments for me. The share prices may remain depressed in the short run while markets recover. That’s fine, as I plan on owning these for a long period, possibly forever.

It’s high-quality businesses like these that can execute consistently over the long term. Buy them now while they are still cheap and hold them till they’ve reached their true value.

That’s how to be the most successful when it comes to investing. And until these companies reach their full potential, I’ll continue to look for more TSX stocks to buy undervalued.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Daniel Da Costa owns shares of SUNCOR ENERGY INC. and THE NORTH WEST COMPANY INC.

More on Dividend Stocks

money cash dividends
Dividend Stocks

These TSX Telecom Stocks Are Dialling Up Impressive Profits 

Two telecom stocks are dialing up dividend profits for shareholders while inflation and interest are slowing dividends for some companies.

Read more »

Group of industrial workers in a refinery - oil processing equipment and machinery
Dividend Stocks

2 Top Canadian Energy Stocks to Buy Right Now

Blue-chip TSX stocks like these two Canadian energy sector giants can help you generate substantial long-term wealth growth.

Read more »

edit Safety First illustration
Dividend Stocks

Safeguarding Your Wealth: 5 Safe Stocks to Buy in a Rising Interest Rate Market

Established companies like the Canadian National Railway tend to be relatively safe in tough economic conditions.

Read more »

Various Canadian dollars in gray pants pocket
Dividend Stocks

1 Passive-Income Stream and 1 Dividend Stock for $288 in Monthly Income

It can be hard to invest when you don't have any cash, so create some from this passive-income method and…

Read more »

IMAGE OF A NOTEBOOK WITH TFSA WRITTEN ON IT
Dividend Stocks

2023 TFSA Contribution Time: 2 Dividend Stocks to Buy With $6,500

Buy these two great dividend stocks in your TFSA as a part of a diversified portfolio if you haven't already.

Read more »

Construction work on a site
Dividend Stocks

Canadian Infrastructure Stocks: Building the Future and Your Wealth

These two Canadian infrastructure stocks are highly defensive and offer excellent long-term potential, making them ideal for this uncertain market.

Read more »

HIGH VOLTAGE ELECRICITY TOWERS
Dividend Stocks

Dividend Investors: Top Canadian Utility Stocks for June 2023

These three top utility stocks could be excellent buys for income-seeking investors.

Read more »

A tractor harvests lentils.
Dividend Stocks

Why Nutrien Stock Is Still a Great Buy on the TSX Today

Nutrien (TSX:NTR) stock has gone through major ups and downs thanks to outside influences, but its bottom line remains incredibly…

Read more »