This view is based on the idea that generational spending is cyclical. Baby boomers ramped up spending in the late 1970s, leading to a spike in inflation in the early 1980s, around the time they were in their mid-to-late 30s. Buying homes, having children and adding vehicles can increase demand faster than supply can keep up.
Millennials are now creating the same kind of dynamic. So for those looking to take advantage of TSX-traded consumer staples picks, here are three companies that I think look too cheap to ignore right now.
Spin master
Canadian toymaker and children’s entertainment company Spin master (TSX:TOY) has been absolutely decimated in recent years. After peaking near $50 per share in 2022, shares of this consumer discretionary company have seen a significant decline and have recently traded closer to the $20 level.
Much of this downturn is due to deteriorating fundamentals and the widespread view that children’s entertainment is more cyclical than ever before. That’s true.
However, the company’s core intellectual property remains robust, and I think this is a company that can innovate its way out of its slump. Since it’s more of a speculative choice to revive long-term consumer spending growth, I think it’s wise to pick up shares of TOY stock as it trades around eight times forward earnings.
Dollarama
In the world of Canadian retailers Dollarama (TSX:DOL) remains one of my top picks, not only because of the company’s long-term growth strategy and the performance of its underlying stocks.
The stock chart above is indeed one that should inspire awe in many investors. Unfortunately, I think the reality is that these trends will continue as Dollarama’s growth is driven by a consistent trade-down effect among consumers looking for more price-conscious options for their home goods.
Providing value in this economy is a business strategy that I believe can deliver meaningful long-term benefit. And Dollarama’s expansion of its product selection and price increases (I recently visited a location and the typical $1.25 price was now $1.75 for many items — still cheap, but not where it was before) could fuel continued growth in the long run.
I think we will see this K-shaped economy continue and perhaps become more robust in the Canadian market. If that’s the case, Dollarama looks like a solid buy, even at what might be considered historically high levels.
Restaurant brands
Last, but certainly not least, on this list of consumer discretionary stocks to consider in 2026 is Restaurant brands (TSX:QSR).
The fast-food giant’s shares have benefited from similar trade-offs as Dollarama lately. As more diners opt for cheaper options from one of Restaurant Brands’ core banners (Tim Horton’s, Burger King and Popeye’s are the three largest), this is a company that could have a meaningful advantage.
Aside from the fact that I view QSR stock as a top dividend in this current environment with a yield of around 3.5%, I think there should be similar growth dynamics happening over time as we saw above with Dollarama. So, with a better valuation than it has in years, Restaurant Brands is a value, growth and return play that I think is unmatched today.
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