In today’s volatile economic climate, safeguarding your investments against potential downturns is paramount. Amidst looming macroeconomic challenges, identifying defensive stocks with resilient business models and solid financial fundamentals can provide stability and steady returns. Here, we delve into three compelling options that investors should consider for their defensive portfolios.


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Restaurant Brands International Inc. (TSX: QSR)

Restaurant Brands International, the powerhouse behind renowned brands like Burger King, Tim Hortons, and Popeyes Louisiana Kitchen, stands out as a robust contender in the quick-service restaurant sector. Despite facing some growth moderation recently, the company continues to thrive on its franchise-based revenue model, bolstered by strong consumer spending trends.


With a price-to-earnings ratio under 18 and a dividend yield of 3.4%, Restaurant Brands offers an attractive valuation and income potential. Its diversified portfolio and focus on affordable dining options position it well to weather economic uncertainties, making it a compelling defensive stock pick.

Fortis Inc. (TSX: FTS)

Fortis Inc., a leader in the North American utility sector, boasts a commendable track record of over 50 consecutive years of dividend increases. Operating 10 utility transmission and distribution assets across Canada and the United States, Fortis serves millions of customers and benefits from stable, recurring revenue streams.


Investors favor Fortis for its defensive characteristics, evidenced by its modest price-to-earnings ratio of 17 and a generous dividend yield of 4.4%. As governments prioritize energy infrastructure investments, Fortis stands poised to capitalize on the growing demand for reliable electricity, reinforcing its appeal as a defensive stock.

Bank of Nova Scotia (TSX: BNS)

Bank of Nova Scotia, commonly known as Scotiabank, holds a prominent position in Canada’s financial landscape with a robust presence in key Latin American markets. Offering a comprehensive suite of banking, wealth management, and global markets services, Scotiabank benefits from geographic diversification and a strong balance sheet.


Despite its exposure to economic cycles, Scotiabank’s conservative valuation, with a price-to-earnings ratio of 10 and a substantial dividend yield of 6.7%, makes it an attractive defensive investment. The bank’s prudent risk management practices and broad client base underscore its resilience in navigating economic uncertainties.


Amid the prevailing macroeconomic challenges, investors seeking stability and income should consider incorporating defensive stocks like Restaurant Brands, Fortis, and Scotiabank into their portfolios. These companies not only offer solid earnings and cash flow resilience but also provide attractive dividend yields, making them suitable candidates for weathering market volatility.