2 Stocks to Help Grow Your TFSA in a Recession

Jamieson Wellness (TSX:JWEL) and Alimentation Couche-Tard (TSX:ATD) won’t make you rich, but they can help you get a positive return for 2023.

| More on:
TFSA and coins

Image source: Getty Images

Undoubtedly, markets have already had ample time (stocks have dragged for 11 months now!) to price in a recession, the severity of which remains unknown. While a severe recession could bring forth more downside in the TSX Index, I’d argue that long-term investors should continue to scoop up stocks that will keep moving onward, regardless of how much worse the consumer can get!

When it comes to your TFSA (Tax-Free Savings Account), don’t make rash decisions based on fear or greed. While fear has been the main emotion on Wall and Bay Street this year, we’ve had some pretty sudden upticks in greed in the form of short-lived bear market rallies. Many bottom chasers have been fooled (that’s a lower-case f), but for how long remains the million-dollar question.

Consider shares of Jamieson Wellness (TSX:JWEL) and Alimentation Couche-Tard (TSX:ATD), two earnings growth firms that can (and probably will) end 2023 higher, regardless of what type of landing the market is in for!

Jamieson Wellness

Jamieson is a vitamin and supplement maker that’s been around for more than 100 years. It’s a proud Canadian brand that has quite a lot of brand affinity, in my opinion. Undoubtedly, vitamins are commodities. But when it comes to health, it’s clear that brands do matter in the space. Jamieson’s green caps are unmistakable. With top-notch quality control practices, the firm can command a premium price versus the generics.

As the firm embarks on a global expansion, I’d look for Jamieson to innovate in the supplements space. Jamieson’s protein offerings have been intriguing and could act as a launch pad for the firm, as it looks to power its earnings higher through rough waters.

The stock is down 23% from its 2020 all-time high just north of $40 per share. After fluctuating wildly for two years in a $33-40 consolidation channel, I think shares are poised for a technical bounce at some point over the next 18 months. Given the defensive nature of the industry, I’d bet such a bounce could come as soon as 2023.

Alimentation Couche-Tard

Couche-Tard is one of my favourite Canadian companies, because of its easy-to-understand business model and its superb managers. The company owns and operates convenience stores across the globe. Over the years, the firm has found the perfect mix of organic and inorganic (via acquisitions) growth. Unlike many other merger-and-acquisitions-focused growth firms, Couche-Tard shifts gears when it sees the opportunity to maximize shareholder value over the long run. At any given time, there are a ton of takeover targets in the global convenience store market.

Couche-Tard is very much a global play, and its ear is open to any potential deals as it looks to consolidate a fragmented industry ahead of the rise of EVs (electric vehicles). Of late, Couche-Tard has been sitting on its cash pile, waiting for a deal it can’t refuse. In due time, I think Couche-Tard will act, and when it does, investors could pile into the stock, as most announced deals tend to be positive catalysts for shares.

Recession or not, Couche-Tard is ready to move higher from here. The stock is dirt cheap at 16.9 times trailing price to earnings, given its recession-resilient growth.

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 Joey Frenette has positions in Alimentation Couche-Tard Inc. The Motley Fool has positions in and recommends Alimentation Couche-Tard Inc. The Motley Fool has a disclosure policy.

More on Investing

Oil pumps against sunset
Investing

Oil or Tech? Why Choose When You Can Get Both in a Single Stock?

Tech stock Pason Systems (TSX:PSI) is exposed to the energy market boom.

Read more »

A red umbrella stands higher than a crowd of black umbrellas.
Investing

Protect Against Inflation With 2 Top TSX Stocks

Here are two top TSX stocks that long-term investors concerned about inflation may want to consider in this time of…

Read more »

Woman has an idea
Tech Stocks

The Smartest Stocks to Buy With $20 Right Now and Hold Forever

These under-$20 stocks have the potential to grow further with time and deliver solid capital gains.

Read more »

A close up image of Canadian $20 Dollar bills
Dividend Stocks

TFSA Investors: Put $45,000 in These Top TSX Stocks and Watch Your Passive Income Roll In

Are you looking to retire early? Here are a few ideas about how your TFSA could earn a passive-income stream…

Read more »

Human Hand Placing A Coin On Increasing Coin Stacks In Front Of House
Dividend Stocks

Love Passive Income? Here’s How to Make Plenty of it as a Real Estate Investor

You could definitely create passive income by investing in pure real estate, but you could make just as much, if…

Read more »

Make a choice, path to success, sign
Dividend Stocks

2 High-Yielding Dividend Stocks You Can Buy and Hold for Years

These two high-yielding dividend stocks can be the perfect addition to your portfolio, as the bear market causes payout yields…

Read more »

A worker uses a laptop inside a restaurant.
Tech Stocks

Why Investors Shouldn’t Give Up on Shopify Just Yet

Here's why long-term investors may not want to throw in the towel just yet on e-commerce juggernaut Shopify (TSX:SHOP).

Read more »

Retirees sip their morning coffee outside.
Dividend Stocks

TFSA Wealth: How to Turn $88,000 Into $1 Million for Retirement

Canadians can use the TFSA to hold a basket of diversified equity investments, allowing you to turn a $88,000 investment…

Read more »