Despite the market posting double-digit gains this year, investors are increasingly concerned about a market pullback on the horizon. Fortunately, there are some comforting stocks to help offset that concern.
Here’s a look at 3 of those comforting stocks to line your portfolio with today.
Source: Getty Images
First, you need some defensive picks
Defensive stocks are largely immune to broader market volatility. That’s because they offer products and services which are necessities that consumers cannot, or are unwilling to cut back on.
Prime examples of this include utilities and telecoms, more specifically, Fortis (TSX: FTS) and Telus (TSX: T).
Fortis is one of the largest utilities in North America. Across its 10 operating regions, Fortis provides electric and gas service to over 3 million customers. The sheer necessity of the utility service translates into a reliable revenue stream.
That revenue stream allows Fortis to invest in growth while paying out a handsome dividend. As of the time of writing, that dividend pays out a yield of 3.5%.
Adding to that appeal, Fortis also boasts an incredible streak of over 50 consecutive years of dividend increases. This furthers the appeal of Fortis as one of the comforting stocks to own.
Turning to Telus, the telecom offers a similar defensive appeal. Telus provides subscriber-based wireless, wireline, TV and internet services. In recent years, the defensive appeal of those services has increased.
Concurrently, Telus is continuing to invest in growth initiatives, including expanding its digital services footprint and 5G and fibre networks.
Telus is a defensive pick with massive growth potential. But perhaps best of all is the dividend that Telus offers.
As of the time of writing, the dividend on offer is an impressive 7.5% yield. Prospective investors should also note that, like Fortis, Telus has an impressive run of annual or better increases going back over a decade.
In short, both Telus and Fortis are comforting stocks ideal for any portfolio.
What about a big bank for some big income?
Canada’s big bank stocks are almost always candidates as comforting stocks for any portfolio. And the big bank for investors to consider right now is Bank of Montreal (TSX: BMO).
BMO offers investors a stable revenue stream from its domestic operations in Canada and an international presence in the U.S. That international segment is the primary growth driver for the bank, where it enjoys a presence in 32 state markets.
Both the domestic and international segments collectively generate sufficient revenue to fund BMO’s handsome quarterly dividend.
As of the time of writing, that dividend pays out an appetizing 4.1% yield. Prospective investors should also note that BMO has paid out dividends without fail for nearly two centuries, longer than any other company in Canada.
Adding to that, BMO has an established cadence of providing annual upticks to that dividend going back years.
Not only does this make BMO one of the comforting stocks to buy right now, but also one to hold for the long term.
Final thoughts: What are your comforting stocks?
No stock, even the most defensive, is not without some risk. Fortunately, the trio of stocks mentioned above are comforting stocks that could provide growth and income-producing appeal for years.
Throw in their respective defensive moats, and you have some of the best investments for any well-diversified portfolio.
Buy them, hold them, and watch them grow.
