With broad markets fluctuating turbulently ahead of another Fed policy meeting (don’t expect any interest rate cuts, even as President Trump applies a bit more pressure on U.S. Fed chairman Jerome Powell), value investors may have another shot at getting a great deal on a name that may have gotten away amid the most recent relief rally.
Indeed, stocks can go from a massive losing streak to a massive win streak in short order, making it so incredibly risky to hit that sell button at a time when you think all hope is lost. Indeed, it’s times when it seems like things can’t get any better when the stock market tends to be closing in on a bottom. And while the latest win streak came to a plunging halt on Monday’s session, with the TSX Index dipping 0.31% while the S&P 500 fell around 0.64%, I would continue to play the long game and ride out the huge waves that are sure to cause weak-stomached investors to wipe out.
And while it may be too late to “chase” stocks now that the Liberation Day losses have been recouped, I do think that starting to buy in relatively small amounts (let’s say $1,500 per purchase) could make sense, as a few dollars trickle in across what are sure to be a hectic next few months, as investors pay extra attention to any pieces of information the Trump administration can give out regarding tariffs. In this piece, we’ll check in on a Canadian stock that could make a wise buy to kick off the month of May.
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Restaurant Brands stock: A dividend deal on the TSX value menu!
Enter shares of Restaurant Brands International (TSX:QSR), the firm behind Tim Hortons, Burger King, Popeye’s Louisiana Kitchen, and Firehouse Subs. The stock is down around 10.5% year to date. More recently, shares melted up close to 8% in a month. Indeed, QSR stands out not only as a great recession-resilient play to ride out tariff-induced economic damage (and higher prices on many goods), but also as a terrific long-term dividend grower. The stock currently yields 3.8% to go with a side of a 0.62 beta (less than one means a lower correlation to the broad stock market).
For the fast-food firms, 2024 was arguably the year of the value menu. And 2025 could be another year where value triumphs. At the time of writing, the stock looks more or less fairly valued at 21 times trailing price-to-earnings (P/E). However, if you’re looking to play defence, seek a near-4% yield, and want a lower beta, I’d say the price of admission is quite low.
A fair price to pay for a resilient dividend grower
For cautious Canadian investors who have no idea what’s up next with tariffs and seek a name that can hang in there as the economy falls into its worst setback since COVID, QSR stock seems up for the task. With the stock caught in a multi-year rough spot, I’d say now is a great time to get back into the name before the price of admission to defensives goes up.
As we witnessed during the scariest moment of the April sell-off, it’s boring blue chips with dividends that can stay upbeat as everything sinks.
