Concerns over substantial gains in Canadian equity markets, the ongoing trade tensions, and persistent inflation appear to have dampened investor sentiment, leading the S&P/TSX Composite Index to decline by 1.15% last week. Nonetheless, I remain optimistic about the following two stocks, as their regulated or contracted business models make them less susceptible to market volatility and enable them to deliver steady and reliable financial performance.
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Fortis
Fortis (TSX: FTS) operates 10 regulated utility businesses, serving approximately 3.5 million customers across five Canadian provinces, 10 U.S. states, and the Caribbean. With 99% of its assets regulated and 93% tied to low-risk transmission and distribution operations, the company’s financial performance remains insulated mainly from economic fluctuations and market volatility. Backed by this stability, Fortis has generated an average annual shareholder return of 9.7% over the past two decades. It has also increased its dividend for 52 consecutive years, while its forward dividend yield currently stands at 3.56%.
Moreover, the growing electrification of transportation and the rapid expansion of data centres to support the increasing adoption of artificial intelligence (AI) are driving higher electricity demand, expanding Fortis’s addressable market. To capitalize on these trends, Fortis has grown its asset base through capital investments of $4.2 billion in the first three quarters and remains on track to achieve its full-year target of $5.6 billion. Looking ahead, the company’s management has announced a new five-year capital plan of $28.8 billion for 2026–2030. These investments can drive a 7% annualized rate base growth through 2030, reaching $57.9 billion.
Fortis anticipates funding approximately 70% of these investments through internally generated cash and equity contributions, thereby minimizing the need for additional debt. The company has also strengthened its balance sheet by divesting non-core assets. Given its solid growth outlook, management remains confident in delivering annual dividend increases of 4–6% through 2030, making Fortis an attractive long-term investment option.
Enbridge
Enbridge (TSX: ENB) is another Canadian stock I would consider buying and holding for the long term, given its highly contracted midstream operations and low-risk utility businesses. The company also operates 41 renewable energy assets with a combined power generation capacity of 7.2 gigawatts, selling the electricity produced through long-term power-purchase agreements.
Enbridge has limited exposure to commodity price fluctuations, with approximately 98% of its adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) derived from long-term contracts and rate-regulated assets. Furthermore, around 80% of its adjusted EBITDA is indexed to inflation, providing additional earnings stability. Supported by these consistent financial results, the company has delivered an impressive average annualized return of 11.8% over the past two decades. It has consistently raised its dividend at a strong compound annual growth rate of 9% since 1995 and now offers an attractive forward yield of 5.63%..
In the third quarter, Enbridge added roughly $3 billion worth of new projects, expanding its secured capital backlog to $35 billion. The company plans to fund these projects through annual capital investments of $9–$10 billion, which should support steady financial growth. Management expects adjusted earnings per share and distributable cash flow per share to grow at a mid-single-digit rate through the remainder of the decade. Given its solid growth outlook, Enbridge’s management aims to return between $40 billion and $45 billion to shareholders over the next five years, reinforcing its appeal as a strong long-term investment.
