Equity markets across the globe trembled, as Russia invaded Ukraine this week. But though markets dropped, not all stocks felt the same heat. Some stayed resilient and some gained. Here are four such TSX stocks that played relatively strong, even if broader markets felt the jolt.
BCE
Canada’s top telecom company BCE (TSX: BCE)(NYSE: BCE) stayed notably strong this week. This is because BCE has little correlation with broad market indices and broader economic growth.
That’s why even if markets jump or suddenly drop, BCE stock continues its move slowly.
At $61 billion, BCE is the biggest telecom company in Canada and caters to almost nine million subscribers. The company’s net income grew by a mere 2% CAGR in the last 10 years.
However, its stable operations provide earnings visibility, which enables dividend stability for shareholders. BCE is one of the top dividend payers on the TSX, with a nearly 6% yield.
So, if you are not looking for superlative returns and are okay with average, stable returns over a longer term, BCE could be an apt pick.
Canadian Utilities
Another sector that stays relatively resilient is utilities. Utility stocks do not significantly move on broad market actions or broader economic events.
For example, Canada’s one of the top utility stocks Canadian Utilities (TSX: CU) remained flat this week, while tech stocks tumbled big.
Canadian Utilities has returned 15% since last year. It pays highly stable dividends and yields 5% at the moment.
Remarkably, Canadian Utilities has increased shareholder dividends for the last 50 consecutive years.
It will likely continue to hike dividends at a decent rate in the future, driven by its stable earnings and large regulated operations.
Canadian Natural Resources
As tensions between Russia and Ukraine increase, crude oil will gain, particularly at a fast clip. And oil and gas companies will be some of the biggest beneficiaries of it.
Canada’s biggest energy producer Canadian Natural Resources (TSX: CNQ)(NYSE: CNQ) seems well placed to play the oil rally at the moment.
Canadian Natural saw a substantial earnings boost, as crude oil rallied since the pandemic. The company not only recovered pandemic-era losses but posted record earnings in the last 12 months.
CNQ will report Q4 2021 earnings next week. Notably, its higher Q4 numbers should give a big impetus for the stock, which is already topping the charts this year.
CNQ stock has gained 85% in the last 12 months and pays a dividend that yields 3.5%. CNQ’s strong balance sheet and encouraging earnings prospects could drive stably increasing dividends for the foreseeable future.
Dollarama
Canada’s discount retailer Dollarama (TSX: DOL) is my last pick for conservative investors today, especially when markets turn rough.
Dollarama operates around 1,400 stores in Canada and plans to expand to 2,000 this decade. Its widespread presence in the country is really the key behind its relatively faster growth all these years.
Dollarama’s unique value proposition should play well in the inflationary environment amid full re-openings. DOL stock returned 820% in the last 10 years, beating the TSX Composite Index by a wide margin.
