Macroeconomic uncertainties and growing geopolitical tensions have increased market volatility in recent years. Although the TSX Composite benchmark has risen sharply so far in 2024, currently trading with over 15% year-to-date gains, the possibility of heightened volatility in the near term can’t be ruled out as investors remain worried about a potential economic slowdown. This is one of the key reasons why long-term investors should always hold some fundamentally strong, safe stocks in their portfolios.
In this article, I’ll highlight two of the safest Canadian stocks you can buy right now and hold for the long term without worrying about short-term market volatility.
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Dollarama stock
Despite the broader market volatility in recent years, Dollarama (TSX:DOL) has stood out as one of the safest stocks in Canada due mainly to its ability to continue delivering impressive returns. After rallying by 57% so far in 2024, DOL stock currently trades at $150 per share with a market cap of $42 billion.
If you don’t know it already, Dollarama primarily focuses on meeting consumer demand for low-cost essentials, including household goods, food items, and seasonal products. With an expanding footprint and a loyal customer base, the Canadian value chain retailer’s financial stability makes it a standout defensive pick right now.
Another important factor that makes Dollarama stock so attractive during volatile markets is its stable financial performance, even during economic slowdowns. For example, in its latest quarter ended in July 2024, its total revenue rose 7.4% YoY (year over year) to $1.6 billion due to a 4.7% increase in its comparable store sales. In addition, the company’s cost savings, with lower logistics expenses and carrier rates, drove its adjusted earnings up by 18.6% from a year ago to $1.02 per share.
As Dollarama continues to focus on new store openings and its joint venture with Dollarcity, its long-term growth outlook remains strong, which should help its stock maintain an upward trajectory.
Waste Connections stock
Just like Dollarama, Waste Connections (TSX:WCN) is another safe Canadian stock you can consider adding to your portfolio now. Interestingly, WCN stock has yielded positive returns to investors for nine consecutive years, surging by 447% since the end of 2015. In 2024 alone, the stock has inched up by 25% to currently trade at $246.95 per share, increasing its market cap to $63.5 billion.
In the third quarter of 2024, Waste Connections registered an impressive 13.3% YoY increase in its total revenue to US$2.3 billion with the help of better pricing and positive contributions from acquisitions. These factors also led to a 15.5% surge in its adjusted quarterly net profit to US$350 million. Moreover, it remains on track to acquire companies with over US$700 million in annualized revenue, which should accelerate its financial growth trends in the years to come.
As the demand for its solutions continues to rise with growing awareness about environmental sustainability, Waste Connections’s financial growth prospects look strong, which should help its share prices continue rising.
