Canada’s economy is going through a period of transition. Inflation is moderating, but interest rates remain elevated. The Bank of Canada recently held its key policy rate steady at 2.75%, with officials pointing to ongoing risks like sticky inflation and U.S. trade tensions. Meanwhile, TSX futures have been bouncing around in response to shifting global headlines, from G7 meetings to Middle East unrest.
For Canadian investors looking to put $25,000 to work, it’s more important than ever to focus on reliable, diversified businesses that can weather uncertainty and deliver long-term value. That’s where these three Canadian stocks come in.
National Bank
National Bank of Canada (TSX:NA) might be the most underrated bank on the TSX. It doesn’t have the same footprint as the Big Five, but that’s part of its strength. It’s more agile, more focused, and has continued to produce solid returns through different market cycles.
As of writing, the Canadian stock trades around $136 with a market cap of about $53 billion. In its most recent earnings, National Bank posted net income of $906 million and earnings per share (EPS) of $2.57. The results were slightly down from the prior year but still reflected strong fundamentals, especially considering the current rate environment. The Canadian stock also raised its dividend to $1.10 per share, offering a yield of around 3.5% at writing. With strong capital buffers, reliable income, and room for modest growth, it’s a solid pick for stability in uncertain times.
Algonquin
Algonquin Power & Utilities (TSX:AQN) has had its ups and downs, but it’s showing signs of recovery. After facing pressure from rising debt and shifting market sentiment, it has trimmed its capital expenditures and focused on core utility and renewable assets. That’s starting to pay off.
In Q1 2025, the Canadian stock reported revenue of $736.3 million and beat earnings estimates with EPS of $0.17. While modest, this beat came from stronger operational efficiency and lower expenses. The Canadian stock currently trades around $7.86 with a market cap of about $5.5 billion. It offers a dividend yield of approximately 5.5%, which is attractive for investors seeking income.
Algonquin also pays part of its dividend in U.S. dollars, adding currency diversification. It’s a Canadian stock that might not soar right away, but it’s building a foundation for long-term growth and cash flow.
Canadian Tire
Canadian Tire (TSX:CTC.A) is a true Canadian institution. Known for its retail stores and wide-ranging businesses, the Canadian stock also owns a financial services arm and has exposure to real estate through its real estate investment trust (REIT).
As of the most recent quarter, Canadian Tire reported $3.46 billion in revenue and $2 in EPS. Net income came in at $37 million, down from $76 million in the same period last year, due in part to seasonal softness and financing costs. Despite the dip, the Canadian stock continues to pay a strong dividend, yielding close to 4%.
It trades around $180 per share and has a market cap at $10.2 billion. With strong brand loyalty, diversified income sources, and a new focus on higher-margin opportunities, Canadian Tire remains a compelling long-term hold.
Bottom line
Splitting $25,000 evenly across these three names would offer a blend of financial strength, income, and growth. National Bank provides dependable returns from a conservative balance sheet and consistent performance. Algonquin adds renewable exposure and steady utility revenue, with the potential for recovery as it trims costs. Canadian Tire brings retail depth, financial services, and real estate-backed value. Right now, a combination of three could bring in annual income of $675.22!
| COMPANY | RECENT PRICE | NUMBER OF SHARES | DIVIDEND (annual) | TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| CTC.A | $179.78 | 46 | $7.10 | $326.60 | Quarterly | $8,270.00 |
| AQN | $7.83 | 1,064 | $0.26 | $276.64 | Quarterly | $8,335.12 |
| NA | $135.77 | 61 | $1.18 | $71.98 | Quarterly | $8,283.00 |
In the face of economic uncertainty, from mortgage renewals to global trade tensions, the key is to invest in companies that have already proven staying power. With core inflation still hovering above target and rate cuts delayed, Canadian investors need stability and income without sacrificing upside. These three names fit that bill.
