End-of-Year Market Correction? 2 Top Stocks to Buy Right Now

Stock market corrections are essentially impossible to predict, making it crucial to always ensure that your portfolio is in good …

| More on:
Watch for the Warning Signs Stock Market Prices Trends 3d Illustration

Image source: Getty Images

Stock market corrections are essentially impossible to predict, making it crucial to always ensure that your portfolio is in good shape and you’re ready for the unexpected.

Any type of black swan event could cause the market to pull back, as we were reminded early last year. And lately, with inflation surging as well as significant supply issues hitting the market and a pandemic that continues to be resurgent at times, you certainly can’t be fully confident in the economic environment right now.

So if you’re worried about a potential market correction in the near term, don’t be. These are great opportunities to buy the top stocks in Canada at a significant discount. And here are two stocks I’ll be looking to buy immediately the next time there’s a correction in the stock market.

A high-quality Canadian stock to own for the long haul

One of the best and most unique stocks you can buy for the long haul is Brookfield Infrastructure Partners (TSX:BIP.UN)(NYSE:BIP). Brookfield is a stock I already own and would almost certainly add to should a market correction materialize and the units sell off considerably.

Brookfield owns an incredible portfolio of high-quality and defensive infrastructure assets that are diversified all over the world. So already, it’s a business that you can have confidence owning long-term given its portfolio is made up of assets like ports, railroads, utilities, and data storage centres.

However, Brookfield has also demonstrated time and again that it can use its expertise to help increase the cash flow these assets generate or find new investments to expand the portfolio.

This is what makes it such an excellent stock to buy for the long term. It offers a tonne of growth potential but also a tonne of resiliency — something you often have to compromise on when buying stocks.

So the next time there’s a stock market correction — and Brookfield Infrastructure trades off meaningfully — it will likely be one of the first stocks I’ll consider buying.

A top Canadian growth stock to buy immediately in a market correction

In addition to Brookfield Infrastructure, another high-quality Canadian stock that is resilient but still offers significant long-term growth potential is Canadian Apartment Properties REIT (TSX:CAR.UN). As we all know, real estate, especially residential real estate, is one of the top industries to invest in.

So the fact that CAPREIT offers investors a massive, professionally managed portfolio with assets all across Canada and a proven track record, it’s one of the top investments you can own long-term and one of the first stocks I’d look to buy if a market correction materializes.

It’s extremely safe, but also it consistently grows its business as well as the value of its assets. So not only is CAPREIT a Canadian Dividend Aristocrat that increases its distribution to investors each year, but over the last five years, it’s earned unitholders a total return of more than 310%, or a compound annual growth rate north of 15%.

That’s an incredible return, especially given that CAPREIT is generally very consistent, plus your cash is invested in the highly resilient Canadian real estate sector.

So the next time there’s a stock market correction, I’d be getting ready to make some high-quality, long-term investments. And if CAPREIT sells off significantly and trades at an attractive valuation, I’d be scooping up the units and taking advantage of the discount for the short time that it’s cheap.

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 Brookfield Infra Partners LP Units. The Motley Fool recommends Brookfield Infra Partners LP Units.

More on Dividend Stocks

Dividend Stocks

2 of the Best Dividend Stocks to Buy Before They Start to Recover

These dividend stocks offer superior deals for those seeking long-term passive income, but these prices certainly won't last forever.

Read more »

Dividend Stocks

Algonquin Insiders Are Loading Up on AQN Stock – Should You Follow?

Algonquin Power and Utilities (TSX:AQN) insiders poured millions into AQN stock last week. Share valuation multiples seem compelling.

Read more »

Retirees sip their morning coffee outside.
Dividend Stocks

TFSA: 2 Stocks To Earn Passive Income Even in a Recession

Investors are coping with 2023 recession fears differently. Some are investing in stocks that can create long-term passive income.

Read more »

Cogs turning against each other
Dividend Stocks

3 Stocks You Can Confidently Own in an Upside-Down Market

Although many stocks have lost major value this year, here are three high-quality companies you can confidently own in this…

Read more »

Increasing yield
Dividend Stocks

2 Ultra-High-Yield Dividend Stocks on Sale Today

Besides their ultra-high yields, here are more factors that make these two of the best Canadian dividend stocks worth buying…

Read more »

money cash dividends
Dividend Stocks

These Canadian Stocks Actually Pay You to Own Them

While the stock market continues to face significant headwinds, consider these Canadian stocks that will pay you to own them.

Read more »

The sun sets behind a high voltage telecom tower.
Dividend Stocks

3 Top Utility Stocks to Buy Right Now

Are you looking for utility stocks to add to your portfolio? Here are three top picks!

Read more »

ETF chart stocks
Dividend Stocks

My Favourite Investing Ideas on the TSX Today

Investors can bet on TSX energy and bank stocks using these two ETFs.

Read more »