Passive-income investors should stay the course as the coming weeks get a tad more volatile amid tariff uncertainties. Indeed, it’s tough to tell what President Trump has planned with any degree of certainty. Indeed, at times, it can be tough to tell what Canada could be in for.
Either way, I don’t think it’s smart to steer your portfolio off-course just because things can get much worse in the coming months. Indeed, tariffs can be scary to think about, but nobody knows if they’ll be slapped on in a few weeks or if they’ll be removed shortly after. In light of uncertainties, passive-income investors should stay on track, perhaps picking up a few income stocks on weakness while other investors are more fearful.
That way, you’ll not only get a somewhat better price for dividend stocks or real estate investment trusts (REITs) that have dipped on the concerning headline news, but you will also stand to get just a bit more yield. Indeed, every basis point of yield can count over the long haul. So, with that in mind, I’d like to direct your attention to two intriguing names in the passive income scene that may be worth watching or even buying if you’re comfortable with putting new money to work this month.
While I do think it’d be easier to buy such stocks in March, after a decision on tariffs has been made (who knows? perhaps they’ll be delayed further if a deal cannot be reached by Canada and the U.S.), longer-term thinkers should not be inclined to wait around and time markets. At the end of the day, staying invested is oftentimes the best game plan.
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Pizza Pizza Royalty
Who doesn’t love a good royalty, especially if it’s tied to the pizza business? Indeed, with Pizza Pizza Royalty (TSX: PZA), you’re getting some pretty tasty passive income that can hold up through a tariff storm. Indeed, this quick-serve restaurant chain stands to be little moved by tariffs, at least initially.
And if tariffs take a bite out of Canada’s GDP? I’m not so sure about Pizza Pizza, which delivers some pretty affordable dinners to begin with, especially for those customers who take advantage of promos and offers. While not entirely resilient in the face of recessions, I view Pizza Pizza as a way to ride out a storm. Shares are down around 13% from recent highs, with a delicious 7.1% yield. It’s a stable payout and one that should have income investors’ attention.
CT REIT
CT REIT (TSX: CRT.UN) isn’t the most diversified retail REIT in the world, given its exposure to its top tenant. Either way, I’d much rather have more exposure to a single, highly liquid, investment-grade tenant than broad exposure to a number of smaller firms that may fail to pay rent or close up shop at the first signs of a recession. I’ve driven home this belief many times in prior pieces.
In any case, I find it to be a superior (and income-savvy) way to bet on the back of Canadian Tire, the retailer, which could experience rougher waves if tariffs hit and discretionary spending gets rocked in 2025. With a high occupancy rate and a 6.28% yield, the REIT remains one of my top picks for Tax-Free Savings Account investors (think tax-free income!) or retirees who could use a bit of an income jolt.
All considered, CT REIT is a name deserving of your watchlist as it comes back after a rough slide. Just be aware of rate risks and be ready to average down should the recent win streak reverse suddenly.
