For years, we’ve seen stock markets rally rapidly, giving Canadians the chance to immediately grow their capital as soon as they begin to invest. Even with the blip of the pandemic two years ago, most stocks and most industries have continued to climb higher, creating several different Canadian stocks to buy now.
However, more recently, the investing environment has been shifting. As central banks take on the challenging task of cooling down red-hot inflation, there’s a risk that the growth potential of stocks and the economy as a whole could slow.
So, if you’re looking to find high-quality Canadian stocks to buy now, or you already have money in the market and want to make sure it’s protected, here are four of the best recession-resistant investments you can make.
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Defensive companies are the best Canadian stocks to buy now
If you’re looking for high-quality investments you can have confidence in, it’s crucial to find top-notch businesses that will continue to execute through thick and thin. That’s why a top telecom stock like BCE (TSX: BCE)(NYSE: BCE) is so ideal.
The company owns long-life assets that make it a cash cow. Furthermore, it has incredibly resilient business operations — so much so that during the pandemic, BCE’s worst impact came when its revenue fell by just 9%. Most importantly, though, it’s a Dividend Aristocrat.
Another high-quality stock you can consider and, unsurprisingly, a Dividend Aristocrat as well is Emera (TSX: EMA). Emera is a utility stock, which is one of the safest businesses you can own.
In addition, it also owns tonnes of long-life assets. And because the industry is heavily regulated, Emera has a good idea of the growth it can offer to investors well in advance. If you’re looking for low-risk Canadian stocks to buy, Emera is one of the best.
Enbridge (TSX: ENB)(NYSE: ENB) is another stock similar in many ways to Emera. It’s a massive energy infrastructure business, making it crucial to the North American economy. However, it’s also a major cash cow, and it too owns a utility company.
If you’re looking for a recession-resistant investment, Enbridge is one of the safest, high-yielding stocks, currently offering a dividend yield of 5.9%.
And lastly, consumer staple stocks, like North West Company (TSX: NWC), are also some of the safest Canadian stocks you can buy. In addition, like the other three stocks, North West is a Canadian Dividend Aristocrat.
It’s not only a stock that should have robust operations, but it will also return growing passive income over the long haul.
Bottom line
As you can see, each of these four stocks is from a different industry. What they all have in common, though, is that all these stocks are high-quality companies, and their operations are essential.
Whether it’s energy stocks or utilities, consumer staples, such as groceries, or telecommunications, these are some of the most important and essential businesses in our economy.
This makes them highly defensive, which is why they are so recession-proof. In addition, each of these stocks returns attractive passive income, and they’re all Canadian Dividend Aristocrats.
So, when you can count on businesses to continue executing through thick and thin, and they’re businesses that will continue to increase the cash they’re paying to investors, then they’re certainly some of the best Canadian stocks to buy if you’re worried about a potential recession.
