4 TSX Stocks to Buy if the Economy Slows but Doesn’t Break

When the economy slows but doesn’t break, TSX stocks tend to split into two camps. Highly cyclical names get punished as investors fear the next downshift. Steadier businesses often hold up because demand doesn’t vanish, and because lower rates usually follow slower growth, which can lift income stocks. In that kind of market, the best strategy often looks boring. Focus on companies with essential services, durable cash flow, and clear reasons earnings can stay resilient even if GDP growth cools.

Fortis and CN Rail: 2 Infrastructure Stocks That Earn Whether the Economy Grows or Slows

Infrastructure stocks can shine in a soft-landing economy because they run on long time horizons. Fortis (TSX: FTS) is a regulated utility that earns returns by investing in power and gas infrastructure, while Canadian National Railway (TSX: CNR) is a freight railway that moves the real economy across North America. Over the last year, Fortis has stayed focused on predictable execution, expanding its five-year capital plan to $28.8 billion and extending its dividend-growth streak to 52 straight years. CNR emphasized service and productivity, kept returning capital through buybacks, and laid out 2026 capital spending of $2.8 billion, signalling discipline rather than a spending spree.

For 2025, Fortis reported net earnings of $1.7 billion, or $3.40 per share, and adjusted earnings per share (EPS) of $3.53, up from $3.28 in 2024. In Q4 2025, net earnings were $422 million, or $0.83 per share, versus $396 million, or $0.79 per share, a year earlier. Valuation has recently sat around a price-to-earnings (P/E) ratio near 23 with a dividend yield around 3.3%. The upside is steady rate-base growth and annual dividend increases of 4% to 6% through 2030, so investors will want to keep watch.

Meanwhile, in Q4 2025, CNR stock reported revenue of $4.5 billion, net income of $1.3 billion, and diluted EPS of $2.03, while improving its operating ratio to 61%. For full-year 2025, revenue was $17.3 billion, net income was $4.7 billion, diluted EPS was $7.57, and free cash flow reached $3.3 billion. CNR trades at a P/E around 18 with a dividend yield of 2.6%.

BCE and Intact Financial: 2 Everyday Canadian Stocks With Very Different Income Profiles

Everyday stocks can also outperform in a slow-but-not-broken economy because people keep paying the bills. BCE (TSX: BCE) sells connectivity through wireless and wireline services, while Intact Financial (TSX: IFC) sells insurance that households and businesses can’t easily cut. Over the last year, BCE remained in the spotlight as investors debated the sustainability of its dividend. Intact stayed in a stronger position, with pricing power in insurance.

Before we consider BCE as an income stock, I have to acknowledge that BCE cut its annualized dividend in the second quarter of 2025, reducing the payout from $3.99 per year to $1.75 per year. The dramatic cut triggered a sharp decline in the stock price. The current quarterly dividend is just shy of $0.44 per share.

[Related: What’s going on with BCE’s dividend?]

BCE’s appeal is the income, but the market wants proof the reduced payout is sustainable. The current yield is 4.9%. The upside in a slowing economy is that rates can drift lower and investors may rotate back to yield, while BCE’s recurring revenue base provides stability. If you’re thinking about investing in BCE today, know that it’s a show-me-the-stability story, not a steady-compounder story.

Meanwhile, Intact Financial is in a fundamentally different position. In full-year 2025, Intact reported operating net earnings per share of $19.21, up 33% from $15.30 in 2024, with Q4 EPS of $5.50 beating estimates by 17%. And unlike BCE, it raised its quarterly dividend — to $1.47 per share, annualizing to $5.88 for a current 2.4% yield.

The stock is going for around $254, and its P/E of about 14 is actually a pretty modest multiple for a business with this quality of execution and consistent earnings growth.

Bottom line

If the economy slows but doesn’t break, the goal isn’t to predict every data point. It’s to own businesses that can keep earning while everyone else worries. Fortis and CN give you infrastructure earnings that barely flinch in a soft-growth environment. Intact gives you an insurance compounder that tends to do well when macro uncertainty keeps pricing firm. BCE gives you a higher yield but with a lower degree of certainty — it can work, but only if the dividend holds and the business stabilizes.

All four can earn income from a $7,000 investment while you wait. For BCE specifically, the next quarterly earnings report on April 30 will be the clearest near-term test of whether the payout is on track.

Together, these give you a mix of resilience and upside for a softer-growth 2026.