It’s starting to appear to be the dreaded stock market crash 2.Zero has arrived. Two weeks after the preliminary September selloff, stocks have crashed as soon as extra — once more, led by tech. With consensus rising that Federal Reserve stimulus is about to expire, and rising uncertainty concerning the U.S. election, buyers are getting positively spooked.
Fortuitously for Canadian buyers, there are nonetheless many nice Canadian stocks to select from. The TSX Index is much less weighted in tech in comparison with U.S. indexes, with much more “traditional” dividend performs within the combine. Over the previous decade, that has muted the Canadian markets’ returns. In September 2020, it may really be an asset.
With that in thoughts, listed here are three “safe” TSX stocks that will help you survive a market crash 2.0.
Alimentation Couche-Tard (TSX:ATD.B) has been one of many best-performing TSX stocks over the previous decade, rising greater than 1,000% within the markets. Its good points will be attributed to a sensible acquisition technique, that has seen the corporate open plenty of new shops with out taking up loopy quantities of debt.
In 2003, the corporate acquired Circle Ok from ConocoPhillips. That instantly gave the corporate the quantity two spot within the U.S. comfort retailer market. It additional leveraged the chain right into a dominant place in Canada. At this time, ATD.B stock is doing nicely. It’s now up for the 12 months after a short decline within the COVID-19 market crash. It noticed 47% earnings progress in its most up-to-date quarter, regardless of a COVID-related decline in gasoline gross sales. Its dividend yield (0.63%) is low, however the stock has an unimaginable observe file of dividend progress.
Fortis (TSX:FTS)(NYSE:FTS) is without doubt one of the most reliable dividend stocks within the historical past of the TSX. As a utility, you’d anticipate it to be “dependable,” as that total business is closely regulated with locked-in contracts and excessive boundaries to entry. Nevertheless, Fortis has accomplished higher than the typical utility through the years.
Previously 5 years, it has outperformed the TSX and the TSX utilities sub-index. That’s thanks in no small half to heavy investments in growth. Fortis has acquired property throughout Canada, the U.S., and the Caribbean; just lately, it inked Canada’s first deal to produce LNG to China. In its most up-to-date quarter, adjusted EPS was up barely 12 months over 12 months, regardless of COVID-19 headwinds. The stock yields 3.5% right this moment and extra dividend progress is predicted sooner or later.
BMO Coated Name Utilities ETF
Persevering with with the utilities theme, we now have the BMO Coated Name Utilities ETF (TSX:ZWU). That is an ETF with a whole lot of fascinating traits. Because the identify implies, it’s based mostly closely on utilities, nevertheless it additionally has some holdings in telcos and pipelines. It’s additionally partially a “fund of funds,” with different ETFs in its portfolio.
If you need large yield, you would do a lot worse than ZWU. The fund writes lined calls as a yield-enhancement technique, which provides it its astonishing yield of 8.1% earlier than charges. On that word, this fund’s charges are fairly excessive for an ETF (0.72%), so that you received’t really take house a full 8% yield. Nonetheless, it’s a really excessive yield choose based mostly on very secure underlying holdings.
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Idiot contributor Andrew Button has no place in any of the stocks talked about. The Motley Idiot recommends ALIMENTATION COUCHE-TARD INC and FORTIS INC.