Trump tariffs aren’t startling markets as much as they were this time last month, with global markets coming to terms with the levies imposed and hoping for deals to come. It’s impossible to tell what we’ll be left with after Trump has had the opportunity to sit down with leaders from every major nation. For now, it seems like 10% tariffs are the lowest he’ll go. That said, anything is negotiable, and for those who play ball with Trump, it’ll all be about the art of the deal.
In the meantime, investors who’ve been losing sleep, troubled by the potential for the tariff war between Canada and the U.S. to escalate, should look to play some defence. In this piece, we’ll look at steady gainers that stand to be less impacted by tariff-related growth scares. And while they may not melt up if Trump were to unexpectedly take tariffs to zero, they do stand to offer peace of mind in a time when it’s easy to be scared out of numerous long-term positions.
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Loblaw
Loblaw (TSX: L) is a stock I’ve been pounding the table on in recent years. The performance really does speak for itself, with L shares now up 76% in the last two years and more than 223% in five years. I think there’s still room to run, as Loblaw continues expanding its footprint across the nation.
In a prior piece, I highlighted discount retail store No Frills as a powerful growth engine for times like these, when the economy wobbles and inflation has the potential to rear its ugly head again. Though it’s not going all-in on No Frills, it is leaning heavier towards lower-cost store banners. And that should help the firm thrive if a recession were to hit in 2025 or 2026.
All considered, Loblaw is a recession-resilient firm that shows you don’t need to settle for meagre returns by playing it defensively. And with minimal tariff exposure, L stock stands out as a must-own for those looking to reduce their overall exposure to levies imposed by Trump.
It’s a defensive growth staple that I wish I hadn’t sold!
Dollarama
Up next, we have another high-value retailer that’s continuing to expand across the nation. The Dollarama (TSX: DOL) growth story seems to “rhyme” with that of Loblaw’s. And its stock chart is equally impressive, with shares nearly doubling in just the past two years! Indeed, Dollarama was built for tougher times (inflation and stagflation). And while a downturn may actually jolt the firm’s prospects, I still think the stock is a bit pricey for most at more than 40 times trailing price-to-earnings (P/E).
Indeed, demand for high-quality recession-resilient stocks is arguably at a high point. And with less exposure to U.S. tariffs (it’s more dependent on China-Canada trade), the stock stands out as a very intriguing name to buy at a time like this. Personally, I’d wait for a near-term pullback before loading up. Though I’m not against nibbling here if you’re willing to steadily build a position over the next 18 months or so.
