If you’re looking for a safe stock with the ability to keep your portfolio stable while the broader market swings up and down, you may want to focus on the basics. Essentials like food and medicine never go out of demand. No matter what the market or economy is doing, people still shop for groceries and fill prescriptions.
That’s what makes Metro (TSX: MRU) worth considering right now. It runs a network of well-known food stores and pharmacies under banners like Metro, Food Basics, and Jean Coutu. In this article, I’ll explain how Metro’s dependable business model, rising profits, and strategic investments make it a stock that could work in just about any market.
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A top consumer staples stock to buy
Headquartered in Montréal, Metro operates nearly 1,000 food stores and around 640 pharmacies across Quebec and Ontario. After rallying by 16% so far this year, MRU stock currently trades at $104.80 per share and carries a market cap of $22.9 billion. It also offers a modest quarterly dividend, translating to a current annualized yield of about 1.4%.
But Metro’s real value lies in its consistency, as the stock has risen in 18 out of the previous 20 years.
Stable growth in a shifting environment
Metro’s second quarter results for its fiscal 2025 (ended in March) show why this top consumer staples stock keeps ticking upward. For the quarter, Metro’s sales rose 5.5% YoY (year-over-year) to $4.9 billion. The company’s food same-store sales grew 5.3% from a year ago, while pharmacy same-store sales jumped 7%, with a strong 7.8% surge in prescription drugs. This growth clearly showcases strong demand for its products across the board.
Last quarter, Metro’s online food sales were also up by more than 26% YoY, which could be seen as a clear sign that it’s benefiting from changing customer behaviour without losing its edge in physical stores.
On the profitability front, the company’s adjusted net profit climbed by 9.8% YoY in the latest quarter to $226.6 million. Similarly, its adjusted quarterly earnings climbed 12.1% from a year ago to $1.02 per share despite facing higher energy costs and fees related to online partnerships, which shows its cost control efforts are paying off.
Why this stock thrives in any economy
Another factor that sets Metro apart is how well it balances operational efficiency with ongoing expansion efforts. Over the last year, it has made big investments in distribution and automation – like its Terrebonne facility for fresh and frozen goods, and the final phase of a new distribution centre in Toronto. Those moves have already started to deliver cost savings and smoother supply chain operations.
In the meantime, Metro continues to return value to shareholders. It has been actively repurchasing shares under its current buyback program and recently declared another quarterly dividend of $0.37 per share.
A stock with high dependability
While Metro doesn’t hype or make big promises, it sticks to its core strengths in supplying affordable food and essential health products. At the same time, the grocer keeps fine-tuning its model with smart investments and measured growth.
With a solid balance sheet, growing earnings, and a retail footprint that reaches into nearly every household in Quebec and Ontario, Metro has the ability to keep delivering no matter what the broader market does next.
