1 Canadian Stock I’d Buy Before Trade Tensions Heat Up Again

Trade tensions can rattle markets, but food companies like Maple Leaf tend to hold steadier because people still need to eat.

Key Points
  • Maple Leaf is now more focused on prepared foods after spinning off its pork business into Canada Packers.
  • Earnings and margins improved in 2025, and debt fell, showing the turnaround is gaining traction.
  • It offers a roughly 3% dividend and defensive demand, but costs and tariffs could still pressure margins.

Trade tensions can make investing feel like grocery shopping during a storm. Prices move fast, confidence drops, and investors start asking which companies can still hold steady. Tariffs can lift input costs, border delays can pinch supply chains, or a weaker consumer can hurt demand. So, in that kind of market, I’d rather look at businesses tied to everyday needs.

Food fits. People may delay a new couch or vacation, but they still eat dinner.

Income and growth financial chart

Source: Getty Images

MFI

That’s why Maple Leaf Foods (TSX: MFI) looks interesting right now. Maple Leaf stock is one of Canada’s best-known food companies, with brands such as Maple Leaf, Schneiders, Mina, Greenfield Natural Meat, and Lightlife. It sells prepared meats, poultry, plant protein products, and other packaged foods across Canada and beyond. In a choppy trade environment, boring can look pretty beautiful.

The biggest recent change came from its pork spinoff. In October 2025, Maple Leaf stock completed the separation of its pork operations into Canada Packers, which now trades separately on the TSX under CPKR. That move simplified Maple Leaf stock into a more focused prepared-foods company. It also removed some commodity pork volatility from the main business, while Maple Leaf stock kept a connection through its remaining stake and supply arrangements. For investors, that creates a cleaner story.

Into earnings

The latest earnings also gave Maple Leaf stock a stronger case. In the fourth quarter of 2025, Maple Leaf reported revenue of $991.2 million, up 8.1% from $917.1 million the year before. Adjusted operating earnings rose to $67.2 million from $52.8 million. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) came in at $117.3 million, up from $108.3 million. Furthermore, adjusted earnings per share (EPS) hit $0.32, compared with $0.18 a year earlier. That’s a solid finish to a year when many consumers still watched every dollar.

The full-year numbers looked even better. Sales reached $3.9 billion in 2025, up 7.7% from $3.6 billion. Adjusted EBITDA climbed 21% to $476 million, and the adjusted EBITDA margin improved to 12.2% from 10.8%. Adjusted EPS rose to $1.09 from just $0.15. Net debt also fell to 2.1 times trailing adjusted EBITDA, down from 2.7 times a year earlier. Recently, Maple Leaf stock carried a market cap near $3.6 billion and a trailing price-to-earnings (P/E) ratio of 84. Don’t let that fool you. It looks low because of a one-time gain tied to the pork disposal, so the forward multiple near 18 gives a more realistic read.

Future focus

Looking ahead, Maple Leaf stock fits as it sits in a defensive category with room to improve margins. A more focused prepared-foods company can spend more energy on brands, pricing, plant efficiency, and cash flow. If trade tensions lift costs, Maple Leaf stock won’t escape the pressure. Still, branded food companies often have more pricing power than purely cyclical businesses. That gives it a better chance to protect profits than companies tied to big-ticket spending.

There’s also a quiet income angle here. Maple Leaf’s dividend yield recently sat around the 3% range, providing investors some return while they wait for the new structure to prove itself. Even that can bring in ample income with a $7,000 investment.

COMPANYRECENT PRICENUMBER OF SHARESANNUAL DIVIDENDANNUAL TOTAL PAYOUTFREQUENCYTOTAL INVESTMENT
MFI$28.81243$0.88$213.84Quarterly$7,000.83

The stock isn’t risk-free. Food inflation can hurt volumes. Consumers can trade down. The spinoff still needs time to fully realize its benefits. And if tariffs hit ingredients, packaging, logistics, or exports, margins could wobble. Still, the business looks much sturdier now than it did during its heavier investment period.

Bottom line

If trade tensions heat up again, I’d rather own a company selling familiar food brands than chase the most exciting name on the TSX. Maple Leaf stock has a clearer business, better earnings momentum, a cleaner balance sheet, and a defensive product base. It won’t shoot the lights out overnight. But in a market where investors may soon want stability with some upside, MFI looks like a Canadian stock worth buying before the next trade scare arrives.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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