2 Canadian Stocks to Buy Before Economic Fears Fade

Investors who buy before economic fears fade usually want businesses that can hold up while everyone else stays nervous. That often means companies with everyday demand, pricing power, and enough earnings strength to keep growing even if consumers turn cautious. The nice part is that when fear hangs around, these kinds of Canadian stocks can still trade at reasonable valuations. That gives long-term investors a chance to buy quality before confidence comes roaring back.

PBH

Premium Brands (TSX:PBH) fits that idea as it sells the kinds of food people keep buying in all kinds of economies. It owns a wide mix of specialty food and distribution businesses across meat, seafood, sandwiches, baked goods, and more. Over the last year, it stayed busy expanding its footprint, including completing the acquisition of Stampede Culinary Partners after year-end and signing an agreement to sell its 74% interest in Shaw Bakers. That kind of portfolio reshaping gives it more room to focus on higher-growth areas.

The latest earnings were strong. Premium Brands reported record 2025 revenue of $7.48 billion, up from $6.47 billion in 2024, while adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) rose to a record $672.2 million from $593.7 million. Adjusted earnings per share (EPS) climbed to $4.57 from $3.98, and free cash flow reached $294.8 million. That’s solid progress for a consumer-facing company operating through commodity inflation and a fussy shopper backdrop.

Valuation still looks fair enough for a business with this kind of scale, with a trailing price-to-earnings (P/E) ratio of roughly 93.7 at writing. That multiple looks elevated partly because reported earnings lag adjusted operating performance. The more useful point may be the outlook. Management guided for 2026 sales of $9.25 billion to $9.55 billion and adjusted EBITDA of $870 million to $910 million. Risks remain, especially around beef costs and consumer sensitivity, but this still looks like a high-quality name worth buying before sentiment improves.

LAS

Lassonde (TSX:LAS.A) is a quieter Canadian stock, but that’s part of the appeal. It makes and markets fruit juices, drinks, and specialty food products, with strong operations in Canada and the United States. That gives it exposure to staple categories rather than the kinds of purchases consumers quickly cut. Over the last year, it kept building for future growth, including pushing ahead with its New Jersey facility, which management says remains on budget and on schedule for completion in early 2027.

Its 2025 results showed real momentum. Lassonde reported sales of $2.93 billion, up from $2.60 billion in 2024. Operating profit rose to $226.1 million from $174.7 million, while adjusted EBITDA jumped to $344.1 million from $275.8 million. Profit attributable to shareholders reached $149.7 million, and EPS climbed to $21.94 from $16.73. That’s the kind of earnings growth that gets more attention once macro fears start easing.

The valuation also looks far more grounded. Lassonde holds a trailing P/E of about 10.5 as of writing. Management is also still targeting growth while aiming to reach $3 billion in sales. The risks are straightforward: input costs, consumer spending pressure, and execution on expansion projects. Even so, for a defensive food name with improving profitability, Lassonde looks like the kind of stock that could rerate once investors stop hiding from the economy.

Bottom line

If you want to buy before economic fears fade, these two Canadian stocks make a lot of sense. Premium Brands offers a broader growth story with portfolio moves and rising sales, while Lassonde brings steadier staple demand and a much cheaper valuation. Neither one is flashy, and that’s exactly the point. When the mood finally improves, solid businesses like these often get noticed in a hurry.

The post 2 Canadian Stocks to Buy Before Economic Fears Fade appeared first on The Motley Fool Canada.

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Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.