The TSX Index has been on a roll over the summer, but stocks can be volatile in the fall months. Certainly, there is always lots for the market to worry about. The COVID-19 Delta variant is causing case counts to surge across Canada. Likewise, we have a fall federal election, monetary policy concerns, and geopolitical escalation across the world (Afghanistan and Taiwan, to name a few).
Considering the TSX’s strong run up in 2021, it’s not a bad idea to consider how your portfolio is positioned. Having a balanced, diversified portfolio can be a great asset. Having a mix of defensive stocks, dividend stocks, growth stocks, and consumer staples can all help ensure stable growth in your portfolio. Here are three smart TSX stocks that can give you a nice balance of defence and offence as we head into September.
A top TSX health stock
If you (like me) are concerned about another challenging COVID-19 winter season, one TSX stock you could consider owning is Jamieson Wellness (TSX:JWEL). Jamieson has one of Canada’s best-known brands when it comes to vitamins, supplements, and health products. As people hope to boost their immune systems during flu season, Jamieson should continue to see strong sales growth across its verticals.
This company has done a great job of managing its supply chain, keeping costs low, and expanding its distribution network. It has successfully been taking market share in huge markets like China, Southeast Asia, and Europe.
Since 2016, revenues have grown by a compounded annual growth rate (CAGR) of 13%. Yet adjusted EBITDA has grown even faster at 17.1%. Since its inception, this company’s margins have consistently improved. For a long-term play on important health and wellness trends, this is a great TSX stock to buy and hold.
A top TSX defensive/income stock
If you are concerned about a potential TSX stock market correction in the fall, Fortis (TSX:FTS) is a good defensive stock to hold. This stock has a very low beta, so its correlation to the overall stock market is very low.
Fortis operates a very defensive business of electric/natural gas transmission and distribution assets. There is nothing more essential than electricity and heating/cooling, so the company collects very predictable, regulated streams of cash.
The company is investing heavily to expand its rate base across its portfolio. It expects to grow by 30% over the next four years. This should result in an earnings-per-share CAGR of 6% over that period. This TSX stock pays a compelling, well-covered 3.5% dividend, which should grow at the same rate as cash flows.
A top e-commerce stock
Cargojet (TSX:CJT) is really well positioned as we head into the historically higher-volume shipping months. It operates Canada’s largest overnight air-freight delivery business. It has the planes, routes, infrastructure, and contracts to give it a very strong competitive moat. I like to think of it as the railroad of the skies.
It has key partnerships with the likes of Amazon.com, Canada Post, and DHL. Over the winter, people are less likely to go out and more likely to click their phone and collect packages from their doorstep. This will be accelerated if we see pandemic-related lockdowns again.
Regardless, society is now expecting same-day, next-day, or two-day delivery as a standard now. That bodes extremely well for more freight volume to pass through Cargojet’s business. Not to mention, the company is looking to expand internationally. This could be a new growth runway that might propel this TSX stock even higher.
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.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Fool contributor Robin Brown owns shares of Amazon, CARGOJET INC., and JAMIESON WELLNESS INC. The Motley Fool owns shares of and recommends Amazon and CARGOJET INC. The Motley Fool recommends FORTIS INC and recommends the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon.