If the economy avoids a recession, investors can afford to get a little more optimistic. That doesn’t mean chasing every risky stock with a nice story, but looking at companies tied to consumer spending, travel, industrial demand, and big-ticket purchases that can recover when confidence improves. These stocks often struggle when everyone expects a downturn, but can move quickly when the market starts pricing in better growth, steadier jobs, and lower borrowing stress.
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MTY
MTY Food Group (TSX:MTY) is a great example of this. The company owns, franchises, and operates a large portfolio of restaurant brands, including quick-service, casual dining, and takeout concepts across Canada, the United States, and international markets. It’s not a pure recession-proof business, since restaurant spending can soften when consumers feel pinched. However, if the economy avoids a hard landing, MTY could benefit from steadier traffic, better franchise confidence, and stronger demand for convenience. Meanwhile, in the last year the company continued to focus on debt reduction, cash generation, and squeezing more value from its huge brand network.
In fiscal 2025, system sales reached about $5.7 billion, while net income attributable to owners came in at $119 million. Normalized adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) was $291.9 million, and operating cash flow reached $184.2 million. In the first quarter of 2026, revenue came in around $267.8 million, while earnings per share (EPS) of $0.98 beat expectations. Same-store sales slipped 2.5%, which shows consumers remain careful. Still, with trailing 6 times earnings and a business that throws off cash, MTY could work well if spending stabilizes instead of cracking.
ACQ
AutoCanada (TSX:ACQ) is more cyclical, which is exactly why it could do well if recession fears fade. The company runs franchised auto dealerships across Canada and the United States, selling new and used vehicles while also offering parts, service, finance, insurance, and collision repair. Car sales depend heavily on consumer confidence, credit availability, and interest rates. That hurt the business as buyers grew cautious. Over the last year, AutoCanada closed its remaining RightRide locations, cut costs, managed inventory more tightly, and pushed ahead with restructuring efforts aimed at improving profitability.
Its recent earnings show both the risk and the opportunity. In the third quarter of 2025, revenue from continuing operations fell to $1.2 billion from $1.4 billion a year earlier. Gross profit dropped 22.2% to $187.4 million, and the company posted a net loss of $2.9 million. Yet adjusted EBITDA came in at $58.1 million, and the adjusted EBITDA margin actually improved to 4.8% as costs fell. The stock recently traded around 26 times trailing earnings. So this may not be a sleep-at-night stock. Still, if rates ease, buyers return, and management’s cost cutting sticks, AutoCanada could bounce hard.
BBD
Bombardier (TSX:BBD.B) may be the clearest “economy avoids recession” pick of the three. Bombardier stock builds business jets and has rebuilt itself around its Challenger and Global aircraft families, along with a growing services business. Over the last year, Bombardier stock kept proving its turnaround was not just a nice headline. Demand for private jets remained solid, services revenue grew, and the company’s backlog gave investors more confidence in future sales. The Global 8000 also adds a fresh product catalyst.
The numbers were strong. For 2025, Bombardier stock revenue rose 10% to US$9.6 billion, while free cash flow reached US$1.1 billion. In the first quarter of 2026, revenue rose 5% to US$1.6 billion, services revenue jumped 25% to US$617 million, and adjusted EPS hit US$1.81. Bombardier stock also raised its 2026 free cash flow outlook to more than US$1 billion and reported a backlog of US$20.3 billion. After a huge share-price run, valuation risk is real. Furthermore, a weaker economy could slow jet orders. But if growth holds up, Bombardier stock’s services, backlog, and debt reduction story still look powerful.
Bottom line
MTY, AutoCanada, and Bombardier stock each offer a different way to invest in a better-than-feared economy. And if Canada avoids recession, these stocks could have room to surprise investors who got too gloomy too soon.
