The announcement of a ceasefire and ongoing peace talks between the United States and Iran has boosted investor confidence, driving a strong rebound in Canadian equity markets. The S&P/TSX Composite Index has risen 9% from last month’s lows and is now trading just 1.7% below its all-time high.
However, uncertainty around the outcome of these negotiations and potential disruptions from the conflict continue to pose risks. In this environment, maintaining a well-balanced portfolio — combining growth, defensive, and dividend stocks — can help optimize returns while managing downside risk. With that in mind, here are my three top stock picks.
A person stands in front of several doors representing different U.S. stock options for Canadian investors.
Celestica
Celestica (TSX: CLS) stands out as a compelling growth stock, driven by its strong exposure to several high-growth industries. The company provides critical infrastructure solutions for hyperscalers to build and scale data centres, while also maintaining a solid presence across the aerospace and defence, industrials, healthcare technology, and capital equipment markets.
The rapid adoption of artificial intelligence (AI) is a key tailwind. As enterprises move beyond pilot programs and integrate AI into core operations — and as individuals increasingly rely on AI tools — hyperscalers are ramping up investments to expand data centre capacity. This trend is creating significant long-term growth opportunities for Celestica.
To capitalize on this demand, the company is prioritizing innovation, forming strategic partnerships, and expanding its manufacturing capabilities. It plans to invest around $1 billion this year—roughly 6% of expected 2026 revenue—to broaden its global footprint and enhance its strengths in high-reliability manufacturing, advanced design engineering, and end-to-end supply chain solutions.
Given these favourable industry dynamics and ongoing investments, Celestica appears well-positioned to sustain strong financial growth and continued share price appreciation.
Fortis
Fortis (TSX: FTS) stands out as a strong defensive investment, supported by the essential nature of its operations. The company serves the electricity and natural gas needs of 3.5 million customers across the United States, Canada, and the Caribbean. With about 93% of its assets in low-risk transmission and distribution and a predominantly regulated asset base, its financial performance remains largely insulated from commodity price swings and economic cycles.
This stability has translated into consistent returns, with Fortis delivering an average total shareholder return of 10.8% over the past 20 years. The utility has also increased its dividend for 52 consecutive years and currently offers a forward yield of approximately 3.4%.
Looking ahead, rising energy demand — driven by economic growth, transportation electrification, and the expansion of AI-focused data centres — continues to support its outlook. To capitalize on these trends, Fortis plans to invest $28.8 billion through 2027, which could grow its rate base at an annualized 7% to $57.9 billion. Backed by its regulated business model and ongoing investments, Fortis appears well-positioned to deliver steady growth regardless of broader market conditions.
Enbridge
My final pick is Enbridge (TSX: ENB), a top-tier dividend stock with a strong track record of rewarding shareholders. The company has increased its dividend for more than 31 consecutive years and currently offers an attractive forward yield of about 5.5%. Its business model is highly resilient, with roughly 98% of earnings generated from regulated assets or long-term take-or-pay contracts. In addition, nearly 80% of its earnings are indexed to inflation, helping protect cash flows from rising costs. This stability has enabled Enbridge to grow its dividend consistently.
Looking ahead, rising oil and natural gas production and consumption in North America continue to provide a long-term tailwind for Enbridge’s infrastructure and services. The company has identified $50 billion in growth opportunities and plans to invest $10–$11 billion annually to advance these projects. Supported by its contracted business model and solid growth outlook, Enbridge appears well-positioned to sustain and increase its dividend in the years ahead.
