Top 5 Canadian Grocery Stocks to Buy and Forget.

Melisa R. H. Posted On January 31, 2019

Grocery stocks are great consumer staple stocks that are defensive in times of volatility, such as what we have seen in the past months. Metro has been hitting its 52-week high, as seen on our high list.

Big box stores such as Costco and Walmart are threatening the growth of grocery stores, as they create super centres that offer much more than just groceries and can sometimes offer better value. These companies are ramping up their grocery section and are looking into online as well. The minimum wage situation could also affect grocery stores negatively, since they run on pretty tight margins. Competition could cut revenues and leave grocery stores vulnerable. However, people have to eat and grocery stores aren’t going anywhere so this might be a good place to hide during stock market storms.

Couche-Tard, who’s weathered the sell-off, is growing its business and might threaten the classic grocery store with its convenience and availability. As a company that continually adds value to stockholders, this could be a good alternative buy.

🛍 Consumer

Canadian groceries y drugstores

Metro Inc (A) (MRU-T)

Metro Inc (A) (MRU-T) — Stockchase

Metro has two buys, five holds and a $74.29 price target that's 7.5% higher than the current price. Its 4.63% profit margin beats Weston's 4.11% and Empire's 2.69%, though Metro's gross margin lafs those peers. Again, you won't get rich buying Metro shares, but you can park your money here and see a safe, though…

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Loblaw Companies Ltd (L-T)

Loblaw Companies Ltd (L-T) — Stockchase

(A Top Pick Jul 21/22, Up 3%) Consumer needs, not wants, is the place to be. Mid-teens PE ratio. A compounder of 14% over the last decade. Slow and steady.

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Empire Company (A) (EMP.A-T)

Empire Company (A) (EMP.A-T) — Stockchase

Very expensive, trading up near maximums. Be patient, let things fall to something that will give you a better rate of return.

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Goodfood Market Corp. (FOOD-T)

Goodfood Market Corp. (FOOD-T) — Stockchase

(A Top Pick Apr 28/21, Down 67.4%) Are building online grocery sales now. When he recommended it, he expected another leg up--and shares rose last summer on good numbers. But he sold this around $10 because he was concerned the company was no longer focusing on meal kits and was spending a lot to enter…

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North West Company (NWC-T)

North West Company (NWC-T) — Stockchase

Allan Tong’s Discover Picks Average daily volumes are only 90,000 shares, but NWC pays a hefty dividend yield of 4.22% (huge among the grocers) and safe based on a 21.88% payout ratio. NWC also offers a super-low beta of 0.62. It is safe and defensive. Performance is also consistent. The company has beaten or met…

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These companies are a threat:

Walmart Inc (WMT-N)

Walmart Inc (WMT-N) — Stockchase

The question was comparing the two companies as an investment. Walmart is a very large blue chip company that is not growing quickly. He prefers Five Below which is growing faster. There should be a very quick payback in nine months. There is nothing quite like it. They have just under 1400 stores.

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Costco Wholesale (COST-Q)

Costco Wholesale Corporation (COST-Q) — Stockchase

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. EPS of $3.42 beat estimates of $3.28. Sales of $53.6B slightly missed estimates of $54.26B. Costco's top-line growth in fiscal 4Q may be driven more by traffic as the average basket size declines, though same-store sales excluding fuel and foreign exchange face tough comparisons. Food…

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Convenience Store.

Alimentation Couche-Tard (B) (ATD.B-T)

Alimentation Couche-Tard (B) (ATD.B-T) — Stockchase

(A Top Pick Feb 01/22, Up 12%) Well-run and positioned to offer e-charging stations given all their stations and locations. Well-financed. Still has a little more upside.

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