The dream market dip usually arrives with perfect timing, bargain prices, and enough patience to let every investor finish transferring cash. The real version tends to drop briefly, reverse without permission, and leave carefully prepared buyers staring at yesterday’s quote.
While the S&P/TSX Composite trades near record highs, waiting for a correction feels sensible when prices look elevated. Yet the next pullback might be 5% rather than 20%, while the strongest businesses could fall even less before recovering.
I wouldn’t respond by investing every available dollar today. I’d start with a partial position in a profitable company that can keep growing if the market refuses to provide a spectacular entrance.
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No planned dips
Market declines become obvious only after they’ve happened. Beforehand, investors must guess whether a 3% wobble will become a correction or disappear before lunch. Waiting for the perfect bottom can therefore create a second risk: remaining uninvested while earnings, dividends, and share prices continue rising.
A staged approach removes some of that pressure. Investors can open a position now, keep cash available, and add during future weakness. That’s less dramatic than announcing the exact market bottom on social media, although it has the useful advantage of not requiring supernatural powers.
This approach works best with durable Canadian blue-chip stocks that don’t require a recession to make their valuations sensible.
CCL
CCL Industries (TSX: CCL.B) is the world’s largest label company. It produces packaging and labels for healthcare, food, beverages, household products, electronics, and automobiles. Its other businesses include Avery printable products, Checkpoint retail-security technology, and Innovia specialty films.
Labels aren’t especially useful for impressing dinner guests. They are remarkably useful for creating repeat business. Large customers need enormous quantities of regulated, secure, and precisely manufactured packaging, while switching suppliers can create delays or quality problems.
Second-quarter sales increased 9.1% to $2.1 billion, including 5% organic growth. Adjusted earnings per share (EPS) rose 10.7% to a record $1.35. CCL stock also returned $325.3 million through dividends and share repurchases during the quarter, while maintaining leverage of only 1.1 times adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA).
What $5,000 buys today
Near $97.14, CCL stock trades around 20.8 times trailing earnings and close to its 52-week high. That isn’t bargain-bin territory. However, record earnings, low leverage, and continued buybacks make the valuation reasonable enough for an initial investment.
A $5,000 purchase would acquire 51 full shares for $4,954.14. The current $0.36 quarterly dividend would provide $73.44 annually, although growth and buybacks remain more important to the investment case than the approximately 1.5% yield.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | ANNUAL DIVIDEND | ANNUAL TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| CCL.B | $97.14 | 51 | $1.44 | $73.44 | Quarterly | $4,954.14 |
CCL stock still faces currency swings, acquisition risk, higher material costs, and weaker consumer or industrial demand. Checkpoint’s quarterly operating income fell 20.2%, while management warned that customers may have built inventory early to avoid supply disruptions and price increases. Some recent demand could therefore prove temporary.
Bottom line
All in all, I’d begin with one-third of my intended position, add during a 5% to 10% decline, and invest the remainder after another solid earnings report. Investors learning how to buy stocks in Canada don’t need to choose between chasing and waiting forever.
The next market dip may eventually arrive, but it might not place CCL stock where hopeful buyers expect. Owning a starter position now ensures the market can’t leave the entire plan behind when it changes direction.
