2 shares I own and will buy more if they fall

Volatile market, stock volatility

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Whether we like it or not, we may be heading towards wear market territory. This is not fun. In fact, it is very stressful. But for those of us who can keep our cool and act strategically, a bear market is actually a gift. When all stocks fall, even the good ones are affected. Here is the opportunity. Today I am going to explore two Canadian stocks to buy as their prices decline.

The gift of a bear market

A bear market occurs when stocks “fall 20% or more from recent highs amid widespread pessimism and negative investor sentiment.”

Just as all stocks seem to go up in a bull market, all stocks seem to go down in a bear market, even the good ones. Sentiment takes over and there is often a lack of real analysis. When optimism is the dominant sentiment, bad companies often emerge. Similarly, when pessimism is widespread, good companies can fall. The common thread here is that stocks move based on sentiment more than anything else. When emotions run high, specific fundamentals are often overshadowed.

Rising interest rates will have a negative impact on most, if not all, businesses. However, from a longer-term perspective, companies with solid fundamentals will mostly experience a bear market as a pointless temporary blip. Let’s take a look back at 2008 to give ourselves some perspective. In 2008, the TSX it fell nearly 50% from May 2008 to March 2009. While some companies didn’t make it through this experience, others turned out to be a great buying opportunity.

ECB Stocks: Weathering the Storm

I am currently the owner ECB Inc.. (TSX:AC)(New York Stock Exchange: ECB) for its leadership position as Canada’s largest telecommunications company. It is a protected business with high barriers to entry. It is also a defensive business that produces large amounts of cash flow each year. In 2021, BCE reported more than $3 billion in free cash flow. In its most recent quarter, free cash flow was $1.3 billion, up 7% from last year. I also own BCE shares for their juicy 6% dividend yield.

shares to buy shares ECB tsx

ECB shares have fallen 16% on the TSX from their April highs. You have certainly been caught up in negative sentiment. You are also discounting rising interest rates. Since the company has a considerable amount of debt, higher interest rates will surely affect BCE’s profitability in the future. The question is, how far will ECB shares fall? When will we step in and snatch this superior stock?

Well, in my opinion, I think we can reasonably buy these Canadian stocks right now just for their 6% dividend yield. But I will wait for the market and ECB shares to fall a bit more. At that point, I will buy more tough defensive stocks. Because when the dust has settled, BCE will bounce back.

Tourmaline Stock: Supported by Global Natural Gas Demand

tourmaline oil corporation. (TSX:TOUlisten)) is a Canadian mid-tier natural gas producer, Canada’s largest natural gas producer. It’s on my list of Canadian stocks to buy for a few simple reasons. First of all, tourmaline is practically a proxy for natural gas prices, and the outlook for these prices is promising. Simply put, natural gas has become the fuel of choice both domestically and globally, as the world moves away from coal. Y North American natural gas is the best – reliable, inexpensive and relatively clean.

Natural gas prices have increased dramatically in recent years. This is especially true of liquefied natural gas (LNG) prices in the US and this brings me to the second reason why I buy tourmaline if it falls further.

Bear Market Canadian Stocks to Buy

Tourmaline is increasingly becoming a global player and diversifying its exposure to the price of natural gas. For example, the company has signed a 15-year contract with Cheniere Energy Inc. (NYSE:LNG), the world’s largest exporter of LNG. Under the agreement, Tourmaline will supply Cheniere with 140 billion British thermal units (MMBtu) for its Corpus Christi Stage 3 project.

This will start in early 2023, adding significant cash flow to an already booming cash flow profile. In its latest quarter, Tourmaline reported operating cash flow of $1.35 billion. This was 137% higher than last year. Considering its stellar recent performance and many exciting future growth prospects, TOU is definitely one to add to your watch list.

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