Diversification is the key to security in today’s economic climate. Today we’re going to take a look at one of the most diverse retail stocks on the TSX. This name is Canadian tire (TSX: CTC.A). The store relies heavily on electronic commerce in response to the spread of COVID-19. But that did not prevent his action from rallying this week. It is also not the only innovation of the emblematic company which brings resilience to its company.
Canadian Tire recently reassured stakeholders in a business update: “Last week, with the introduction of sidewalk, customers were offered another way to shop the same day while maintaining their physical distance. Demand for the new service was strong during the first week of operation. “
Its stores in Ontario will now be limited to these innovations for a minimum of 14 days starting April 4. Investors are not too confused, however. Canadian Tire has increased more than 8% so far this week at the time of writing.
Canadian Tire is a diversified retail stock
Its real estate spin-off, CT Real Estate Investment Trust, is also rallying this week. The REIT plunged its nose in March, when the coronavirus market burst. However, CT REIT rebounded this week, despite its high exposure to brick and mortar assets.
CT REIT benefits from a low vacancy rate risk, mainly with single-tenant buildings. These sites are, of course, weighted by Canadian Tire rentals. The positive side is that investors do not have to worry unduly about the loss of income. This is unusual in REITs, a poor quality risk asset for tenants.
Canadian Tire is a great company. It is surprisingly diverse. This stock provides exposure to fuel, clothing, household goods and even financial products. It’s emblematic. He has the classic “buy Canadian” charisma. And its store closings, shareholders should not forget, are only temporary. It is a large retail business that will bounce back after the coronavirus crisis ends.
In general, this would not be a good time to sell Canadian Tire. Selling in weakness brings the market to the front. When investors sell for fear that a price will never improve, they realize their losses. But if devalued stocks are held during difficult times, they generally recover. This is why you must hold what you know and know what you hold.
This means that investors must understand the companies in which they buy. This makes it easier if investors buy companies they already know. This facilitates the holding of difficult markets. Canadian Tire is a brand that few investors know about in the real world. From tires to fuel, sports equipment and household goods, who didn’t buy from Canadian Tire?
If you are a Canadian Tire shareholder, keep holding on. It’s a solid name for long-term dominance in the retail industry. Its innovations, from electronic commerce to curbside collection options, keep this name relevant to the coronavirus market. Value investors also have a good buy here, as the name was beaten by the stock market crash.
Canadian stocks to buy cheaply during the stock market crash
Many investors fear a market collapse. However, long-term investors should accept this crash, as bear markets can potentially save you millions. So if you’re tired of reading that other people are getting rich in the stock market, this could be a good day for you.
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