# Best Canadian stocks for recession



## canadian_investor (Jul 4, 2011)

I'am getting ready to start buying some stable dividend paying Canadian companies if the correction continues. Please suggest me some names.
I don't want to buy the usual bank and financial stocks so most of the dividend ETF and funds are out.
I'm am looking for at least 4% yield.
The only ones I have come up with are FTS, AQN, SAP and BCE.
what else?


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## ddkay (Nov 20, 2010)

AQN has never recovered from the last recession. I would cross that off the list.

I would add CAR.UN.


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## dogcom (May 23, 2009)

FTS is always good and maybe LIQ as everyone needs to drink in these bad times.


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## Argonaut (Dec 7, 2010)

You need yourself a pipeline. ENB, TRP, IPL.UN
You need yourself a telecom. T, BCE
You need yourself a utility. FTS, EMA, CU
You need yourself a real estate. REI.UN, REF.UN
You need yourself a railroad. CNR

Not so coincidentally, I have one of each of these in my permanent hold portfolio. They are declining too, albeit not as much, and the dividends keep coming. I will buy more in the New Year.


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## londoncalling (Sep 17, 2011)

ddkay said:


> AQN has never recovered from the last recession. I would cross that off the list.


Although AQN hasn't returned to its 08 levels it hasn't been hit hard like many other stocks in this recent tumble. It has recently increased its dividend as well. I would keep it on the list.



ddkay said:


> I would add CAR.UN.


This is a good choice as are many reits.


"The beatings shall continue until morale improves"


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## KaeJS (Sep 28, 2010)

Argo posts a good list.

Of his list, I own TRP, BCE and REI

I know a lot of people are hating on the financials lately (and for good reason), but I love the financials. Grab a good Canadian bank while the dividends are at 4%.


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## Argonaut (Dec 7, 2010)

I like financials sometime, but now is not the time. There is still plenty of downside. I own TD but would likely not own it if I didn't get a share purchase plan. Not that it isn't a good stock or company, which it is, but I believe there will be better buying opportunities in the future. TD and BMO not down much YTD. And for some of the banks it's time to start rewarding shareholders with pledged annual dividend increases. Nickel and dime banking fees are increasing, and savings account interest rates are decreasing. Time to give some of this petty cash to the shareholders.


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## KaeJS (Sep 28, 2010)

I don't know about that.

They're too busy buying up US Assets on the cheap to be increasing the payments to their shareholders...


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## Argonaut (Dec 7, 2010)

TD has been buying US assets but has also increased dividend twice this year, and looks to continue the twice-per-year strategy of before. I was moreso talking about the other banks on that front. At any rate, the downside potential is still there on the financials in a way it isn't for my favourite sectors above.


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## Jungle (Feb 17, 2010)

The only one that has not increased div is BMO. They still could in q4 but now I doubt it with markets crashing again.


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## canadian_investor (Jul 4, 2011)

thanks for the names fellas.
i have some of these like TRP but not all.

here's my current holdings

holding : TRP, BMO, REI.UN, CGL (gold)

based on what you guys are saying I add the following to my watchlist:
BCE, FTS, SAP, TD, AQN, T, IPN.UN, EMA, CU

I would love BCE but that stock hasn't fallen much lately.
do ya'll think it is good value at $38+ ?
with the telcos I'm concerned about stupid CRTC decisions one way or another that can hurt these stocks.

with CNR as well the yield is not high enough.

my criteria is that company must have solid cash flows, stable business model, low payout ratio, around 4% yield give or take i.e. not falling knives with high yields.
the idea is to get more yield than average corporate bonds at this time and wait for capital appreciation over 5 yrs. or so.

i'm willing to go lower on the market cap curve i.e. as low as less than $1B but not a yo-yo small cap stock either.

so what else is out there?


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## Sampson (Apr 3, 2009)

canadian_investor said:


> around 4% yield give or take i.e. not falling knives with high yields.


Some would argue you are already catching some falling knives with this criterion.

If I were you, I would also consider that dividends are not the only way to get returns, and there isn't definitive evidence that the dividend growth model for investing isn't simply a measurement of survivorship bias.

Have a read through CC's recent post.


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## canadian_investor (Jul 4, 2011)

i know what you mean Sampson.
that is why I'm looking at or around 4% because i don't want to fall into the trap of those falling knives that yield double digits.
and i am only interested in strong balance sheet and strong cash flow companies.
I hold TRP and BMO and they fit into this category.

i don't know many (or any actually) mid cap companies that may have strong balance sheets and strong cash flow but I'm willing to consider those as well.

screeners are useless these days because of volatile markets. yield ratios, market cap, and EPS ratios are out of whack.

i can do financial research on my own, I know some accounting but I need names and suggestions.


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## Cal (Jun 17, 2009)

http://www.theglobeandmail.com/glob...stment-opportunities-for-2012/article2200069/


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## webber22 (Mar 6, 2011)

Cal said:


> http://www.theglobeandmail.com/glob...stment-opportunities-for-2012/article2200069/


I like this comment after the article ..._
There is a strong argument for dividend paying stocks. But there is also a strong argument against owning dividend paying stocks that trade at twice the market multiple....._

Some companies like Enbridge, TRP, FTS are over-priced now. If rates rise in a year or two, these stocks will be hammered down.


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## Argonaut (Dec 7, 2010)

webber22 said:


> Some companies like Enbridge, TRP, FTS are over-priced now. If rates rise in a year or two, these stocks will be hammered down.


Yet, for good stocks the dividend rises every year. This has a way of keeping the share price up. One can check payout ratios to see if the dividend is sustainable, or use common sense for declining businesses like Yellow or Kodak. Things like pipelines, real estate, and utilities aren't going away any time soon.


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## canadianbanks (Jun 5, 2009)

Argonaut said:


> You need yourself a pipeline. ENB, TRP, IPL.UN
> You need yourself a telecom. T, BCE
> You need yourself a utility. FTS, EMA, CU
> You need yourself a real estate. REI.UN, REF.UN
> ...


This is a pretty good summary of what I like as well .


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## marina628 (Dec 14, 2010)

I guess i need to buy CNR so I got all my bases covered .I own most of the list Argonaut has ,actually I bought majority of them since the past 10 months that i have been on the forum so thanks guys


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## Jungle (Feb 17, 2010)

S&P report cnr as a "buy" under $65. I added positions at this price and love the railroads. Good stock to break up all the energy and financial stocks, along with materials, which is pretty much the tsx.


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## Financial Cents (Jul 22, 2010)

canadianbanks said:


> This is a pretty good summary of what I like as well .


Indeed.


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## fatcat (Nov 11, 2009)

> I'm looking for (as practical as possible) 'recession proof' ETF investments. This is for a mid-long term hold (2 to 5 years), so Im looking for something that I can buy and forget about. In otherwords, the investment should not cause me to lose sleep over.
> 
> Any recommendations/suggestions would be greatly appreciated


i am going with 3 etf's:

ZEO: equal weighted oil and gas (enbridge, suncor, husky, imperial, cenovus, nexen plus others)
XFN: banks and insurance (the big six and the big 4 insurers plus small financials)
ZUT: equal weighted canadian utilities (fortis, emera, transalta, canadian utilities and others)

in the usa i am going with VDC (vanguard consumer staples) and QQQ (technology and health care) and DIA (dow jones for overseas exposure in addition to VWO)


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