Within the subsequent market correction, the largest beneficial properties might go to buyers within the predators that dominate funding markets throughout financial downturns. These cash-rich corporations usually do higher than a median TSX inventory that merely “holds on.”
Historical past exhibits that financial downturns usually are not simply intervals of “destruction”; they’re the best wealth-building home windows for these with the correct ammunition. Whereas the common Canadian inventory could also be slashing dividends and begging the massive banks for liquidity, a choose few Canadian giants will likely be taking part in offence — shopping for distressed property, buying rivals, and swallowing market share entire.
Listed here are three cash-rich TSX shares with the steadiness sheets to show a recession into their most worthwhile period but. You could want to purchase and maintain some or all of them to fortify your core portfolio.
Supply: Getty Photographs
Brookfield Company (BN)
If a recession triggers a fireplace sale on in any other case precious property, Brookfield Company (TSX: BN) is the robust man strolling into the deal room with a briefcase full of money. Going into 2026, the $147 billion different asset administration juggernaut has amassed a US$180 billion asset base that’s supporting BN inventory’s money circulation technology capability, positioning the multi-asset supervisor for one more multi-year development spree.
Brookfield’s managed portfolio’s 30-year efficiency historical past, created proper by three North American financial downturns, printed a 19% compound annual return that might have turned a $1 million funding right into a $285 million wealth pile.
Brookfield invests in actual property and infrastructure property, and it additionally thrives on financial dislocation. When credit score markets freeze and asset costs collapse, determined sellers go to the likes of Brookfield. BN has the facility to cherry-pick one of the best infrastructure and actual property property at disaster pricing throughout downturns.
An $10,000 funding in BN inventory since 2001 might have grown into $636,000 at present – regardless of the previous financial downturns.
Constellation Software program: The vulture of the tech sector
Constellation Software program (TSX: CSU) buys software program corporations with defensible moats. The subsidiaries normally proceed to generate boatloads of money circulation that enrich their mum or dad’s money place, even throughout financial downturns. The surplus money is generally allotted towards new acquisitions of money circulation optimistic targets in a self-reinforcing technique that is still a robust development pillar for the enterprise at present.
Constellation inventory’s enterprise mannequin is good in its simplicity: purchase vertical market software program (VMS) companies, run them effectively, and by no means promote them. Nonetheless, throughout an financial increase, these “tuck-in” acquisitions get costly. When a recession hits, smaller software program distributors begin to sweat. Their income stalls, their traces of credit score dry up, and so they change into “prepared sellers” at affordable multiples.
CSU’s self-replenishing money hoard permits it to go on a purchasing spree precisely when valuations contract. That is how founder Mark Leonard constructed the empire. The tech inventory has declined by 51% over the previous 12 months, spooked by the founder’s departure on well being grounds. However the enterprise mannequin stays very intact, with practically $4 billion in liquid money property to finance the subsequent profitable offers.
Enbridge
Utilities and pipelines seem as boring shares, however in a recession, boring turns into stunning.
Enbridge (TSX: ENB) is an oil and gasoline pipeline large whose capital expenditure budgets are largely self-funded. Its actual money circulation energy lies in its enterprise mannequin. Because the transporter of the vitality that heats properties and fuels vehicles, Enbridge’s income is essentially volume-based, not price-based. Whether or not oil is at $100 or $50 per barrel, hydrocarbon molecules nonetheless want to maneuver by Enbridge’s expansive pipeline community. New ventures into gasoline utilities help money circulation stability.
With tight take-or-pay contracts, Enbridge’s income and money circulation stability help its ever-growing beneficiant dividend. The Enbridge dividend at the moment yields 5.5%, and stays nicely supported by internally generated money circulation, even when the economic system stumbles.
If overvalued tech shares and crypto get crushed throughout downturns, buyers will flock to the protection of ENB inventory’s yield. Furthermore, with its robust liquidity, Enbridge can proceed its “secured development” capital program, constructing the very infrastructure that can gas dividend hikes for the subsequent decade, whereas extremely levered rivals are compelled to halt development initiatives.