The best Canadian stock to own in times of market volatility is the one that has the most stable earnings and cash profile. It’s the one that has little sensitivity to market and economic turmoil. And it’s the one that has proven to be a dependable and reliable steward of shareholder capital.
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What is volatility?
Market volatility is a measure of how much a stock or the market fluctuates over time. High volatility means that prices and/or returns fluctuate sharply over a short time period. Low volatility means that prices and/or returns stay more constant, changing gradually and remaining relatively steady.
This knowledge can help us in our investment decisions today, but how? Well, I’m of the belief that the stock market is vulnerable to weakness in the year ahead. I am therefore favouring stocks that have demonstrated less volatility in their price and returns. This way, I can shelter my portfolio somewhat from the storm ahead.
The best Canadian stock to own
Given this backdrop, I’m reducing exposure to highly volatile stocks and increasing my exposure to low-volatility stocks. I run the risk of missing out on upside if I’m wrong about where I think the market is heading. But, I’ll gladly miss out on this because, by my calculation, the risk/reward trade-off of owning volatile stocks is not in our favour at this time.
Fortis Inc. (TSX:FTS) is one of the best Canadian stocks to buy today in order to shelter your portfolio when volatility returns. The upward swings of the market have been fantastic over the last few years — the downward swings can be equally dramatic.
Fortis is one of North America’s leading utility companies, with nine regulated utilities in Canada, the U.S., and the Caribbean. This is a low-risk business that benefits from stable cash flows and earnings due to its regulated nature. In good and bad economies, Fortis maintains its predictable and resilient revenue and earnings profile.
Fortis’s latest results
In Fortis’s latest results, the company reminded me once again why it’s the best Canadian stock to own in uncertain and volatile times. Adjusted earnings per share (EPS) came in at $3.53 in 2025, which was 7.6% higher than the prior year and almost 5% higher than expectations.
These results were driven by strong rate base increases and strong cost discipline. This performance supported a 4% dividend increase, which Fortis implemented as part of its dividend-growth plan. In fact, Fortis now has 52 consecutive years of dividend increases under its belt.
Looking ahead, Fortis’s plan is to continue to do what it has done throughout its history — drive company and shareholder returns. The company will do this by executing its new record $28.8 billion five-year capital plan. This is expected to drive 7% annual average rate base growth as well as dividend growth of between 4% and 6% through 2030.
The bottom line
The best Canadian stocks to buy if volatility returns and sends the market lower are steady and predictable stocks like Fortis. Consider adding it to your portfolio today as a precaution.
