If you’re finding it difficult to pick reliable Canadian stocks to invest in right now, you’re not alone. Even the most seasoned investors find it difficult to pick good stocks in uncertain economic times when the market is highly volatile, as it has been in the last few months.
While investing in growth stocks could potentially yield high returns in favourable market conditions, they usually tend to be risky, with high volatility amid economic uncertainties. This is one of the key reasons why long-term investors should always include some fundamentally strong, safe stocks in their portfolio. These stalwarts can help them keep getting steady returns even in difficult market environments. Considering the ongoing market turmoil, it could be the right time to park your hard-earned money in such stocks today.
In this article, I’ll highlight two of the safest Canadian stocks you can buy in September 2023, even with a modest investment of $2,000.
Dollarama stock
Dollarama (TSX:DOL) could arguably be one of the safest stocks in Canada to add to your long-term portfolio. This Mont Royal-headquartered value retailer has a market cap of $24.8 billion as its stock trades at $87.61 per share, with about 10.6% gains in 2023.
The strength of Dollarama’s business model is evident in its revenue increase of about 17% in five years between its fiscal year 2018 and 2023 (ended in January). Moreover, the company’s adjusted annual earnings during the same period jumped 82%, clearly reflecting its sustainably strengthening profitability despite facing global pandemic-driven challenges in this period.
Even in difficult economic phases, the demand for Dollarama’s affordable, daily-use products remains high, helping its business remain largely unaffected by economic cycles. As the Canadian retail company continues to expand its store network, you can expect its profitability to improve further in the coming years. The positive profit outlook should drive its share prices higher.
Enbridge stock
If you’re looking for some safe stocks in Canada, Enbridge (TSX:ENB) could be another great pick to consider in September 2023. After rallying by 30% in the previous two years, the shares of this Canadian energy transportation and infrastructure giant currently trade at $47.44 per share with nearly 10% year-to-date losses. At this market price, ENB stock has a market cap of $96 billion and a very attractive annualized dividend yield of 7.5%.
This year’s declines in Enbridge’s share prices could primarily be attributed to a weakness in oil and gas prices and the broader market volatility. Despite the growing economic challenges, however, the company continued to post positive growth in its earnings in the first half of 2023.
In the second quarter, its adjusted earnings grew positively by 1.5% year over year to $0.68 per share as a result of high utilization across its network. Its positive results also encouraged the company’s management to reaffirm its full-year 2023 financial guidance.
Besides its well-established energy transportation business, Enbridge’s gradually expanding presence in renewable energy and crude oil export segments could help it accelerate its financial growth further in the years to come. These factors make this Canadian dividend stock look safe to buy for the long term.
