There are a lot of Canadians out there who may be scared about the current market conditions. In fact, at the time of writing this article, the TSX today has started dropping after the Bank of Canada announced a 50-basis-point increase to the interest rate.
But it’s important that when a downturn like this happens, Canadians seek out opportunities. Now, I’m not saying you should buy up growth stocks. Far from it. If you’re nervous about investing, that’s certainly not for you.
Instead, look into strong companies you can buy cheap for quick returns — ones that will last decades. And luckily, I have three TSX stocks to recommend so you can be greedy, not fearful.
Fortis
A strong option to consider is Fortis (TSX: FTS)(NYSE: FTS), a utilities stock that offers stable returns as well as dividend increases. The company uses its revenue growth to support its dividend and further acquisitions, which then feed back into dividends and returns. It’s a stable business model that’s lasted half a century.
In fact, if you want stability, then TSX stocks like Fortis offer you that in spades. There has been rarely a dip in the share price, even during recessions. Today, shares are up 88% in the last decade. Meanwhile, you have access to a dividend yield of 3.31%. So, now is the time to pick up this stock if you want TSX stocks for defence in your portfolio.
CP Rail
If you’re a long-term investor, now is an excellent time to consider buying Canadian Pacific Railway (TSX: CP)(NYSE: CP). In the short term, the company has a lot of debt to manage thanks to the purchase of Kansas City Southern. But in the long term, it now has access to all the lines KCS has to offer. And that includes oil, grains, and shipping from Mexico.
That makes this one of the best stocks to buy, as it grows at a stable pace, with the potential to explode once debt comes down over the next few years. And it’s had astounding growth, rising 500% in the last decade. Plus, you can pick up a dividend of 0.84% as the company climbs.
Loblaw
Finally, one of the best TSX stocks you can buy are ones that deal with essentials. We learned that during the pandemic, and on the TSX today, it’s not any less true. That’s why Loblaw (TSX: L) remains a strong purchase for those seeking income from essential services.
Loblaw is now the umbrella company over drug stores, gas stations, and grocery stores. Even during a recession, it does well, with clients simply choosing No Frills over Loblaw locations. It’s this loyalty that comes direct from its ever-expanding President’s Choice points program.
Shares have done well over the last decade. During that time, they’ve climb 285% but are down a bit now, offering a significant deal for long-term investors. Plus, you get access to a 1.39% dividend yield at writing.
Bottom line
These TSX stocks are perfect for those seeking a deal, but don’t want a huge drop in returns over the next few years. Each provides stability for Canadian portfolios, while also offering a cheap share price during the market downturn.
