As economic uncertainty and the U.S.-Canada trade tensions continue to weigh on market sentiment in early 2025, many long-term investors are turning to financially strong companies with solid cash reserves. These businesses have the potential to withstand temporary economic downturns, reinvest in growth, and maintain strong dividend payouts. And that’s what makes them attractive choices for cautious investors right now.
In this article, I’ll highlight two top cash-rich Canadian companies with strong fundamentals and explain why they are well-suited to thrive in uncertain economic conditions.
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Brookfield Asset Management stock
That brings us to Brookfield Asset Management (TSX:BAM), the global alternative investment giant. It mainly focuses on essential service businesses by managing real assets, including infrastructure, real estate, renewable power, private equity, and credit. Lately, Brookfield’s stock has been on an impressive run, surging by 54% over the last year. With this, the stock currently trades at $82.62 per share with a market cap of $36.6 billion. The stock also offers a quarterly dividend with an annualized yield of 2.6%.
In the third quarter of 2024, Brookfield delivered record results as its fee-related earnings climbed by 14% YoY (year over year) to US$644 million, driven by strong fundraising and capital deployment. Its fee-bearing capital also jumped 23% from a year ago to US$539 billion due to major capital raises across sectors. Interestingly, the company has successfully raised US$135 billion over the last year and deployed US$20 billion into high-quality investments.
In addition to its strong financial growth trends, another key factor that sets BAM apart from most other businesses is its ability to navigate uncertainty. The company is doubling down on high-growth sectors like artificial intelligence (AI) infrastructure, energy transition, and private credit, which are likely to see strong demand even in economic downturns. With a solid balance sheet, growing earnings, and a focus on long-term value creation, Brookfield Asset Management continues to be one of the top cash-rich TSX stocks to invest in for the long term.
Canadian National Railway stock
Speaking of cash-rich companies, Canadian National Railway (TSX:CNR) is another trustworthy stock to buy now. With a 20,000-mile rail network, CN connects Canada’s east and west coasts to key U.S. markets, which ensures the transportation of over 300 million tons of raw materials, manufactured goods, and consumer products every year. By efficiently moving these goods across the continent, this transportation giant plays an important role in North America’s economy, positioning it as one of the most stable stocks on the Toronto Stock Exchange.
CNR stock currently trades at $148.75 per share with a market cap of $93.4 billion. It also offers a quarterly dividend, yielding slightly over 2.4% annually. More importantly, the company has raised its dividends for 29 consecutive years, making it among the most reliable income-generating stocks in Canada.
In 2025, CNR plans to invest $3.4 billion in capital projects to upgrade infrastructure and improve efficiency, which should help the company improve profitability. This could be one of the reasons why its management is confident in delivering 10% to 15% growth in earnings per share this year.
Although one risk factor worth noting is the ongoing U.S.-Canada trade tensions, which could impact cross-border freight volumes, CN’s strong market position, operational efficiency, and diversified revenue base could help it weather near-term challenges.
