2-for1 Sale
Economic uncertainty is an ever-present feature for investors to navigate, and this new year will be no different — if not worse. The Canadian consumer staples sector remains a haven for long-term-oriented investors seeking stability and steady returns. These companies—providing everyday essentials like food, household goods, and fuel—thrive across market cycles. For 2025, three Canadian stocks stand out for their defensive moats, growth strategies, and shareholder-friendly policies: The North West Company (TSX:NWC), Empire Company Limited (TSX:EMP.A), and Alimentation Couche-Tard (TSX:ATD). Let’s dive into why these picks deserve a spot in your portfolio.
The North West Company stock: A legacy of resilience
With roots dating back to 1668, The North West Company has mastered the art of serving remote communities in Canada, Alaska, and the Caribbean. Its several stores act as lifelines in regions where e-commerce and big-box retailers can’t compete, creating a geographic moat that’s nearly unassailable.
Third-quarter 2024 sales rose 3.3% year over year to $637.5 million, driven by a 4.9% surge in Canadian same-store sales. Even as net earnings dipped slightly (due to labour inflation and new tax laws), its supply chain upgrades, technology integration, and private-label expansion position North West Company stock for margin improvement. A new partnership with Loblaw to sell private-label goods in 2025 could further boost profitability.
Federal programs like the First Nations Child and Family Services compensation and a $47.8 billion 10-year infrastructure funding. These initiatives may bolster disposable income in NWC’s core markets.
A reliable $0.40 per share quarterly payout, which yields nearly 4% annually, and a renewed share buyback program, targeting 4.7 million shares, may support positive shareholder returns and underscore management’s confidence in the company’s financial strength.
North West Company’s defensive business model and strategic investments make it a low-volatility play with upside potential. Watch for progress on cost-saving initiatives and Loblaw-branded product rollouts augmenting investor returns.
Alimentation Couche-Tard stock: The global convenience king
Alimentation Couche-Tard isn’t just a popular gas station operator—it’s a retail juggernaut with more than 14,400 global sites. The convenience store operator’s acquisition-driven growth spree remains at full throttle, and relentless efficiency makes it a standout.
Why is ATD stock a good buy in 2025? Aggressive acquisitions, shareholder-friendly moves and business diversification make the $69 billion retail giant an attractive investment.
Despite a seemingly failed bid for 7-Eleven’s Japanese parent, ATD added 290 U.S. stores in late 2024. Its playbook of buying underperforming sites, rebranding them, and boosting margins through cost cuts remains unmatched.
Consistent stock buybacks have reduced shares outstanding by 15% since 2019, while strong free cash flow fuels dividends and deals.
Beyond fuels, ATD’s fresh food offerings and electric vehicle charging partnerships position it for a low-carbon future.
With a war chest for acquisitions and a proven integration strategy, ATD stock is poised to consolidate the fragmented global convenience stores market and keep growing its earnings per share.
Empire Company Limited stock: Modernizing a century-old consumer staples giant
Empire Company, owner of Sobeys (a grocery chain founded in 1907), combines tradition with innovation. Its 2024 partnerships with Instacart and Uber Eats for same-day delivery signal a savvy pivot to e-commerce, ensuring it stays competitive against disruptors like Amazon.com’s Amazon Fresh.
Why is Empire Company stock a 2025 contender?
Empire’s +1,500 stores across Canada enjoy pricing power in essential categories. Its subsidiary, Sobeys, controls a significant grocery market share, providing steady cash flows.
Aggressive stock buybacks have reduced shares outstanding by 11.3% over five years, amplifying earnings per share growth. Combined with a 1.9% dividend yield, this creates a compelling total-return story. Empire Company stock generated 50% in total returns over the past five years.
Empire Company has grown its empire through accretive strategic acquisitions. The strategy is in its DNA, and investors may look forward to more strategic deals every few years.
Empire Company stock’s blend of scale, modernization, and prudent capital allocation makes it a stalwart for conservative investors. Its focus on premium private labels and digital integration will be key growth drivers for the consumer staples stock in the long term.
