Investing in Canadian stocks to fend off Trump’s tariffs is the suggestion of Pierre Poilievre, leader of the Conservative Party. He called out Tax-Free Savings Account (TFSA) users. The move will enable Canadian companies to spend on factories, equipment, tools, and wages.
Tariffs and potential new ones are why the TSX has continued to spike and dip in recent days. However, some individual stocks have shown strength against the negative market sentiment.
Canadians can invest their TFSA dollars in Algonquin Power & Utilities (TSX: AQN), Peyto Exploration & Development Corporation (TSX: PEY), or Chartwell Retirement Residences (TSX: CSH.UN). Despite the elevated volatility, these dividend stocks have market-beating returns and pay monthly dividends.
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Pure-play utility
The utilities sector (+3.28%) is the second top-performing sector thus far, while Algonquin is its high-flyer. At only $7.42 per share, current investors enjoy a +16.3% year-to-date gain on top of the lucrative 5.7% dividend yield. Your $7,000 TFSA contribution limit in 2025 would generate $373.10 annually, or $31.09 monthly.
The $5.68 billion renewable energy and regulated utility company. Management’s self-imposed responsibility is to bring clean water and energy to people. Growth, operational excellence, and sustainability are Algonquin’s three strategic pillars. Its diversified portfolio includes rate-regulated electric, natural gas, water, and wastewater collection utility systems and transmission operations.
Chris Huskilson, outgoing chief executive officer (CEO) of Algonquin, said, “The company continued to make strides in its transition to a pure-play utility. Over the last 90 days, we successfully completed our Renewables and Atlantica sales.” He added that Algonquin has a recapitalized balance sheet and significant opportunity for improvement to start 2025.
In 2024, net earnings attributable to shareholders from continuing operations reached US$65.3 million compared to the $14.4 million net loss in 2023. However, in the fourth quarter (Q4) of 2024, the net loss was US$189.1 million due to the repositioning for a pure-play regulated utility strategy.
Generous mid-cap stock
Peyto, a mid-cap energy stock, is a “cash gusher.” At $18.10 per share, the dividend offer is 7.26%. Furthermore, PEY (+7.06%) outperforms the broad market (+0.13%) and the energy sector (+1.58%) year to date. This $3.6 billion company operates in the Alberta Deep Basin, where it explores and develops liquids-rich natural gas resources.
In 2024, Peyto paid a record $258.4 million of dividends to shareholders, representing approximately 92% of earnings. According to management, last year was one of Peyto’s most successful operations in 26 years as natural gas prices sunk to multi-year lows and storage inventories remained high. The hedging and diversification program also protects future revenues for the sustainability dividends.
Transition period
Chartwell, in the real estate sector, provides seniors’ housing in Canada. The $4.57 billion real estate investment trust (REIT) owns and operates senior housing communities, from independent living to assisted living and long-term care (LTC).
Vlad Volodarski, CEO of Chartwell, said that besides the outstanding results in all business areas in 2024, there’s great progress in the transition to a more agile and scalable operating platform. In Q4 2024, net income reached $3.5 million versus the $13.2 million net loss in Q4 2023 on a 90.1% weighted average same property occupancy. At $16.71 per share, TFSA investors can partake in the 3.68% dividend. The REIT hasn’t missed a monthly dividend payment since 2004.
Sensible suggestion
Investing in Canadian companies and topping TFSAs is a sensible suggestion. It could indeed bring billions of dollars and result in a self-reliant economy not lacking in investments.
