It’s tough to tell for sure what’s coming with Trump tariffs as the countdown to the expiry of wide-sweeping tariffs continues. Indeed, the summer could have the potential to be a volatility storm, one that’s comparable to the one experienced in the week that followed Trump’s Liberation Day. Indeed, it’s hard to tell what the endgame of the tariff battle will be and if we’ll be in for relief by the time 2026 arrives.
In any case, investors shouldn’t exhaust themselves with the overwhelming and oftentimes tariff-fying headlines that are sure to influence investment decisions. At the end of the day, investors should stay on course and not give in to the panic. Of course, staying in markets could leave you feeling the full force of the next dip, especially if we are in the midst of a bear market.
Though it’s not official (the TSX Index and S&P 500 would need to decline a total of 20% from their peak for the bear to “officially” emerge from its cave), it’s tough to find anyone on Wall or Bay Street who’s not investing like it was a bear market. In any case, it’s an uncertain time, and if you’re exposing yourself to worrisome panic-inducing news (think recession predictors and doomsday forecasts), you’ll probably be likelier to make a mistake with your next big move. Sometimes, it makes sense to sit on your hands and wait things out rather than allowing your emotions to hit the sell button.
If you’re a young investor or a brave older investor who can afford to bear more risk in the face of one of the worst trade wars yet, I think it makes sense to consider the names that could hold their own in a lengthy tariff battle. Think the stocks with well-covered dividends that can fare well, even if tariffs stick, perhaps for longer than expected. It’s these resilient names that I believe can inject certainty into one’s TFSA or RRSP portfolio.
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Emera
Emera (TSX: EMA) is a steady utility that’s in the midst of a furious rally right now, gaining 28% in the past year, more than 11% of which came on a year-to-date basis. Indeed, with a juicy 4.89% dividend yield and a low 0.38 beta, shares of the steady utility are one of the most attractive ways to dodge and weave past every Trump tariff update.
With things looking up for the stock and a modest 18.42 times forward price-to-earnings (P/E) multiple commanded by shares, I’d not at all be surprised if the summer swoon in the stock market doesn’t rock Emera as much. Despite its low correlation to broad markets, be aware that the name could still take a hit on the chin if the magnitude of panic selling approaches post-Liberation Day levels. EMA slipped just north of 7% on Liberation Day tariffs despite its lower exposure to tariffs.
Rogers Communications
Rogers Communications (TSX: RCI.B) stock has already cratered around 54% from its peak. Does it have any more room for downside? Time will tell. Either way, the magnitude of negative momentum has paved the way for severely oversold conditions. With the telecom hitting new multi-year lows of around $34 and change after news that it’s inked an $11 billion deal for the right to broadcast NHL hockey for the next dozen years, I think brave investors may be able to grab shares while they’re going for 10.8 times trailing P/E.
The 5.71% yield is the highest I’ve seen for Rogers. And while it could swell above 7% as the pain continues, I view the battered stock as having less room to get walloped should tariffs take a turn for the worst. In any case, interested dip-buyers should be ready to average into the falling knife over time.
