2 Canadian Stocks to Buy Now and Not Worry About in 2023

TC Energy (TRP) and Quebecor (QBR) are discounted dividend stocks that could soar high in 2023.

| More on:
Simple life style relaxation with Asian working business woman healthy lifestyle take it easy resting in comfort hotel or home living room having free time with peace of mind and self health balance

Image source: Getty Images

It’s an angst-inducing year for many Canadian investors who braved the bear market of 2022, hoping for a quick bounce-back of some sort. While we’ve had a nice rebound off bottom, many bearish pundits are skeptical that the bear has passed.

With so much to worry about in 2023, it’s easy to dismiss the current move off the bottom as just another short-lived bear bounce. With a rough start to December, there are no guarantees that Santa Claus will come to town this year. If anything, we could be in for more of the same, as tax-loss sellers look to make moves before the clock strikes midnight (or the last closing bell rings) later this month.

Despite the profound number of unknowns and negative surprises that we’ve been hit with this year (COVID lockdowns in China and the Ukraine-Russia crisis), there’s room for cautious optimism in the New Year. Yes, there are huge risks, as the Federal Reserve and Bank of Canada look to raise interest rates further. That said, equities have already taken such a beating. Arguably, valuations look good and may set the stage for a 2023 relief rally if things don’t end up as bad as we think!

It’s hard to be optimistic these days. There’s a real shortage. However, for those willing to brave the volatility, there are names out there that you can buy now and think less about in 2023. We’re talking incredibly cheap stocks with powerful dividends that will keep your TFSA or RRSP well-fed as we move through any further chaos or a recession.

Consider TC Energy (TSX:TRP) and Quebecor (TSX:QBR.B), two discounted dividend stocks that too many Canadians may be overlooking.

TC Energy

TC Energy doesn’t get as much attention as it deserves. Indeed, it’s not the most bountiful dividend payer in the midstream energy space. Still, TC Energy stock has a lot to offer in the way of value and dividend growth.

At the time of writing, the stock trades at a mere 17.9 times trailing price-to-earnings (P/E), with a 6.21% dividend yield. That’s a low-cost way to get some pretty sizeable passive income ahead of a recession year that could see 5–7% inflation linger for months on end.

The $58.7 billion pipeline play isn’t just a great way to batten down the hatches ahead of another volatile year, it’s a firm that could benefit greatly from elevated energy prices. While TC isn’t as sensitive to those day-to-day oil or gas moves, it could continue to raise its dividend at a consistent rate from here.

I think TC’s dividend growth prospects are underrated. After a more than 12% plunge off November’s peak, I view the current price ($57 and change) as a great entry point.

Quebecor

Quebecor is another well-run dividend juggernaut that doesn’t get respect from a majority of investors. The Quebec-based telecom has made headlines this year for its ambitious plans of expanding nationwide and bringing the fight to the Big Three Canadian telecoms.

There’s a lot of upside to be had as Quebecor looks to become the fourth major player. Though higher rates could curb such ambitions, one has to think that low valuations across the board could make for a steal of a deal if Quebecor is looking to acquire its way to a wireless foundation in new markets. Further, the government will likely give player number four (Quebecor in this case) first dibs on new infrastructure.

In any case, QBR.B stock is dirt-cheap at 11.2 times trailing P/E. The 4.24% dividend yield is also incredibly bountiful. With such a low multiple and a huge payout, investors can buy the name and forget about it in 2023, as macro noise takes centre stage.

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 no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

More on Investing

A cannabis plant grows.
Cannabis Stocks

Canopy Growth Stock Is Rising But I’m Worried About This One Thing

Canopy Growth stock is soaring as the legalization effort makes real progress in both Germany and the United States.

Read more »

young woman celebrating a victory while working with mobile phone in the office
Investing

3 Roaring Stocks to Hold for the Next 20 Years

These top TSX stocks are excellent long-term buys, given their multi-year growth potential and solid underlying businesses.

Read more »

Two seniors float in a pool.
Dividend Stocks

TFSA: How to Earn $1,890 in Annual Tax-Free Income

Plunk these investments into your TFSA to earn passive income and avoid the taxman.

Read more »

grow dividends
Investing

Here’s My Top 3 TSX Stocks to Buy Right Now

Even though the TSX has been rising, there are still some good bargains out there. Here are three top compounding…

Read more »

Target. Stand out from the crowd
Investing

Prediction: This Canadian Growth Stock Could Double by 2030

Alimentation Couche-Tard (TSX:ATD) is a top growth stock that could do well over the next six or so years.

Read more »

Businessman holding AI cloud
Tech Stocks

Could Investing $20,000 in Nvidia Make You a Millionaire?

Nvidia stock has made investors millionaires in the last 10 years. Is it too late to invest to become a…

Read more »

Engineers walk through a facility.
Dividend Stocks

1 TSX Stock I Wouldn’t Touch With a 10-Foot Pole

AtkinsRéalis (TSX:ATRL) is one TSX stock I'd never invest in.

Read more »

money cash dividends
Stocks for Beginners

Have $500? 3 Absurdly Cheap Stocks Long-Term Investors Should Buy Right Now

If you're looking for cheap stocks, these three have a huge future ahead of them, all while costing far less…

Read more »