2 Interesting Buys in Any Market

Here are two intriguing buys in any market climate that offer defensive appeal as well as growth and income earning potential.

| More on:
Double exposure of a businessman and stairs - Business Success Concept

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

The roller-coaster ride that is 2022 continues to keep investors on edge. The markets continue to edge lower, and with it, the opportunity for long-term gains continues to grow. Specifically, there are some stocks trading at discounted levels that are otherwise great buys in any market.

Here are two intriguing options that should appeal to both new investors as well as seasoned veterans.

Build a passive-income stream right now

Enbridge (TSX:ENB)(NYSE:ENB) is a stock that should be familiar to most investors. The energy infrastructure behemoth is a leader across multiple segments. First and foremost is Enbridge’s lucrative pipeline network.

That pipeline network transports crude and natural gas across Canada and into the United States. In fact, Enbridge hauls about 30% of all North American-produced crude. The company also transports one-fifth of all the natural gas consumed by the U.S.

Keep in mind that Enbridge charges for use of its massive pipeline network. More importantly, those charges aren’t based on the volatile prices of the commodities. In other words, the pipeline business operates like a toll-road network. It generates a steady stream of revenue for the company irrespective of oil prices.

Apart from its pipeline business, Enbridge also operates a growing renewable energy business. The company has invested $8 billion into the segment over the past 20 years. Today, that investment comprises 48 different facilities, most of which are wind and solar farms. Collectively, the facilities have a net generating capacity of 2,172 MW.

Another key advantage of investing in Enbridge is the company’s quarterly dividend. The current yield works out to a very tasty 6.04%. This means that a $40,000 investment in Enbridge will earn an income of just over $2,400 in the first year.

Factor in annual bumps into the equation, and Enbridge comes out as a superb buy in any market. Keep in mind that Enbridge has provided those annual bumps for well over two decades consecutively.

More importantly, if you aren’t ready to draw on that income, those earnings can be reinvested until needed. This will significantly bump any future income potential further.

Despite that appeal, Enbridge is trading down over 3% in the past month.

Here’s another necessity that is a great option

Grocers are one of the most underrated areas of the market that rose to the challenge of the pandemic. When all businesses were shuttered, grocers were deemed essential and continued to operate. Again, the sheer necessity of what they provide made them essential. That necessity also makes them great investment options.

Metro (TSX:MRU) is an intriguing option to consider. Metro is one of Canada’s largest grocers. The company boasts a growing network of over 950 stores primarily located in Quebec and Ontario. That core grocery business is complemented by Metro’s Jean Coutu pharmacy network.

With the cost of food (and just about everything else) increasing lately, there is a likely tailwind expected. Specifically, those surging prices will push consumers to seek out more frugal options.

Still, in the most recent quarter, Metro saw sales surge 1.9% to $4274.2 million. Same-store sales also inched upward by 0.8%. Overall, the company earned $198.1 million, or $0.82 per diluted share.

Turning to income, Metro is a Dividend Aristocrat with an impressive span of 27 consecutive years of dividend increases. That factor alone makes Metro one of the great buys in any market.

You can find great buys in any market

Unfortunately, volatility isn’t going away anytime soon. Both Enbridge and Metro offer investors growth and income that are packaged defensively.

In short, both stocks are great buys in any market. In my opinion, both stocks would do well as part of any well-diversified portfolio.

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 Demetris Afxentiou has positions in Enbridge. The Motley Fool recommends Enbridge.

More on Dividend Stocks

analyze data
Dividend Stocks

2 Safe Dividend Stocks That Could Help You Fight Inflation

A dependable stream of passive income is one way to help offset rising inflation rates. Here are two top dividend…

Read more »

edit Person using calculator next to charts and graphs
Dividend Stocks

Stay Invested in a Recession: Increase Positions in 2 Value Stocks

The suggestion of market analysts is to increase positions in two value stocks if you want to stay invested amid…

Read more »

Hand arranging wood block stacking as step stair with arrow up.
Dividend Stocks

3 Dividend Stocks to Buy as Inflation Surges in Canada

If you're worried about how surging inflation may impact your portfolio, here are three of the best dividend stocks to…

Read more »

You Should Know This
Dividend Stocks

High Inflation: The Good and the Bad for Canadians

Consider tucking away some of your long-term savings in quality dividend stocks like Brookfield Infrastructure in this correction.

Read more »

Dividend Stocks

TFSA Investors: Turn $1,000 Into $10,000 in 10 Years

10-fold growth within a decade is rare but not unheard of. You can capture this growth either by predicting a…

Read more »

edit Real Estate Investment Trust REIT on double exsposure business background.
Dividend Stocks

1 Oversold REIT Stock to Buy for Safe Dividends

If you're looking for stable dividend income from an oversold stock, this office REIT is a perfect option.

Read more »

edit Real Estate Investment Trust REIT on double exsposure business background.
Dividend Stocks

3 Cheap Canadian REITs to Buy in 2022

Are you looking for passive income? Start treasure digging in cheap Canadian REITs in this market correction!

Read more »

Dividend Stocks

TFSA Passive Income: 3 Undervalued, High-Yield TSX Dividend Stocks to Buy Now

These top TSX dividend stocks with high yields now look attractive to buy for TFSA passive income.

Read more »