The Bank of Canada Just Spoke: 2 Canadian Stocks to Buy Now

With rates stuck at 2.25% and inflation still jumpy, these two TSX income names look built for a messy, uneven backdrop.

Amy Legate-Wolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote: “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published May 1, 4:30 pm EDT

| More on: BEI.UNTD

Key Points

TD offers a solid dividend and earnings power, with upside if U.S. remediation stops dominating the story.
Boardwalk benefits from stubborn rental demand, and steadier or lower rates can ease REIT financing pressure.
Neither is risk-free, but both lean on real cash flow instead of hype in an uncertain rate cycle.

10 stocks we like better than Boardwalk Real Estate Investment Trust

The Bank of Canada gave investors a useful hint recently: don’t expect a straight line from here. The central bank held its key interest rate at 2.25%, while pointing to higher oil prices, trade uncertainty, and softer parts of the Canadian economy. Inflation rose to 2.4% in March and could move close to 3% in April, but the bank still expects it to drift back toward 2% in 2027.

That creates a tricky setup. Rates may not plunge quickly, yet the economy still needs support. In that kind of market, investors may want stocks with real earnings, solid dividends, and businesses that can keep going even when consumers feel squeezed.

bank of canada governor tiff macklem — Governor Tiff Macklem; Source: Bank of Canada

TD

Toronto-Dominion Bank (TSX:TD) is relevant now as banks tend to wake up when interest-rate uncertainty begins to ease. TD stock is one of Canada’s largest banks, with major operations in personal banking, commercial banking, wealth, insurance, and U.S. banking. It went through a difficult stretch over the last year because of its U.S. anti-money-laundering issues, but that’s also why TD stock still has a comeback angle. The bank has spent heavily on controls, governance, and remediation. That work remains a risk, but it also gives TD stock a clear path to rebuild investor confidence.

The latest earnings showed why investors have not given up on it. In the first quarter of 2026, TD reported adjusted net income of $4.2 billion, up 16% year over year. Adjusted earnings per share (EPS) hit $2.44. Its Canadian personal and commercial banking division delivered record net income of $2 billion, up 12%. TD stock also ended the quarter with a strong CET1 capital ratio of 14.5%, giving it plenty of cushion.

Valuation helps the case. TD stock recently traded around 11.7 times trailing earnings with a forward dividend yield near 3%. That’s not dirt cheap, but it looks reasonable for a bank with strong Canadian operations and room to recover in the U.S. TD stock fits today’s Bank of Canada backdrop as it can benefit from steady loan demand, improving sentiment, and lower funding pressure if rates eventually drift down. The risk is clear: U.S. remediation could take longer and cost more. Still, patient investors could get paid to wait.

BEI

Boardwalk REIT (TSX:BEI.UN) also looks timely after the Bank of Canada’s update. If rates stay steady or eventually fall, real estate investment trusts (REIT) can catch a better mood. Boardwalk owns and operates rental apartment communities across Canada, with a major focus on affordable housing. That gives it a practical edge. People may delay buying homes when mortgage costs stay high, but they still need places to live.

The latest numbers were strong. For the fourth quarter of 2025, Boardwalk reported funds from operations (FFO) of $1.20 per unit, up 11.1% from the year before. Net operating income (NOI) rose 9.5% to $108.5 million. Same-property NOI climbed 7.3%, and the operating margin improved to 65.8%. Occupancy also stayed high, with management pointing to 97.5% occupancy to start 2026. That tells investors demand remains firm, even in a more competitive leasing market.

Boardwalk’s valuation and income also make it interesting. The REIT recently traded near 18 times earnings, with a monthly distribution yielding about 2.5%. It also increased its distribution by 11.1% for 2026. That’s not a huge yield, but it comes with growth potential. The main risk is that rent growth could slow if affordability pressure rises or if competition increases in key markets. Higher borrowing costs can also weigh on REITs. Even so, Boardwalk fits a softer-rate outlook because lower rates could support property values, financing costs, and investor demand for income stocks.

Bottom line

The Bank of Canada did not give investors an all-clear signal. It gave them something more useful: a reminder to stay selective. TD stock offers a recovery story backed by strong earnings and capital. Boardwalk offers steady rental demand and monthly income. And together, $7,000 in each could bring in ample income.