In this piece we focus on the key blue chips that are down, but certainly not completely out of the game. For new investors looking for a position to lock in for the next five to eight years, the following hard-hit large caps could be worth taking a position on or at least adding to the radar if the stocks continue to pour in over the coming weeks and months.
Enbridge
Long-term income investors shouldn’t hesitate to buy a few stocks Enbridge (TSX:ENB) when they fall into correction territory (remember this is a 10% drop from peak levels). The stock is recovering from such a dip, and while there is a lot to look forward to in the near future, the recent turmoil may not be over just yet.
With more growth on the table for 2026 and a likely dividend increase on the horizon as cash flows rise, I suspect the dividend yield, currently at 6.1%, won’t stay above 6% for long, especially if the next quarter allows for a sustained recovery in shares. While there are many solid dividend giants in January, I still think it’s difficult to beat the pipeline giant’s value proposition, especially since its management team is perhaps one of the most shareholder-friendly in the country.
When times are good, the dividend will grow faster. But in tough times, the company has what it takes to not only keep the dividend intact, but also keep the annual dividend increases going (the company just increased its payout over a month ago, right before the holidays). While the Pipelines may not be the most stable ride in the world, Enbridge’s commitment to its dividend makes it a top dividend growth stock to own for very long periods of time, in my opinion.
Sure, the stock hasn’t done much in the past year, but a lagging 2025 could set the stage for a better 2026, especially considering the company has spent a lot of money on a number of initiatives that will really strengthen cash flows in the coming quarters. Despite the lack of momentum, I continue to think Enbridge stock will reward those who are the most patient.
Empire Companies
Empire Company (TSX:EMP.A) is another hard-hit stock that looks like an attractive buy due to weakness. Shares are down nearly 19% from their all-time highs, partly thanks to margin pressure that has weighed on profitability.
Undoubtedly, the past few quarters may not have been applause-worthy, especially when compared to Empire’s better-performing rivals in the Canadian grocery space. However, despite the pressure and higher costs, I think Empire can overcome the pressure. Ultimately, the supermarket scene remains a great place to start the new year, especially for the chains that can offer good value for money.
As Empire seeks to control costs while increasing its value proposition amid stiff competition with its peers, I’d rather be a buyer than a seller with shares priced at 15.9 times its price-to-earnings (P/E) ratio. That’s too cheap, especially for a low-beta (0.37) (1.8%) dividend stock that can add stability to almost any portfolio.
#Dividend #AllStars #trading #Boxing #Day #prices