Wall Street ended April 6, 2026, in the green zone, with all three major U.S. indices inching up less than 0.6%, as investors remained hopeful for a de-escalation in Middle East hostilities, ahead of the U.S. President’s deadline for an Iran deal. Meanwhile, oil prices continued to make their upward movement. 

Against this backdrop, investors may not feel confident enough to go for high-beta growth-oriented stocks and would instead look for safe bets like low-leverage stocks. These low-debt stalwarts are built to withstand both interest rate swings and global unrest. By providing a secure foothold amid a shifting landscape, they offer a strategic hedge against the looming threat of an energy-driven slowdown.

We recommend low-leverage stocks like The Panant Group (PNTG Quick QuotePNTG - Free Report) , Casey’s General Stores (CASY Quick QuoteCASY - Free Report) , Royal Bank of Canada (RY Quick QuoteRY - Free Report) , Veralto Corp. (VLTO Quick QuoteVLTO - Free Report) , and Stantec (STN Quick QuoteSTN - Free Report) .

Before selecting low-leverage stocks, it is important to understand what leverage is and how investing in low-leverage companies can benefit investors.

What’s the Significance of Low-Leverage Stocks?

In finance, leverage refers to the practice of borrowing capital to help companies run their operations smoothly and expand their business. Such borrowings are done through debt financing. But there remains an option for equity finance. This is probably due to the cheap and easy availability of debt financing over equity financing.

Debt financing has its share of drawbacks. It is desirable only as long as it successfully generates a higher rate of return compared to the interest rate. To avoid considerable losses in your portfolio, it is advisable to avoid companies that rely excessively on debt financing.

The crux of safe investment lies in choosing a company that is not burdened with debt, as a debt-free stock is almost impossible to find.

The equity market can be volatile at times. As an investor, if you want to avoid significant losses, we suggest focusing on stocks with low leverage, which are generally deemed less risky.

To identify such stocks, several leverage ratios have historically been developed to measure the amount of debt a company carries. The debt-to-equity ratio is among the most widely used financial ratios.

Analyzing Debt/Equity

Debt-to-Equity Ratio = Total Liabilities/Shareholders’ Equity

This metric is a liquidity ratio that indicates the amount of financial risk a company bears. A lower debt-to-equity ratio reflects improved solvency for a company.

With the first-quarter 2026 earnings season ahead of us, investors should focus on stocks that have demonstrated solid earnings growth in recent periods.

If a stock carries a high debt-to-equity ratio during an economic downturn, its seemingly strong earnings could quickly turn into a nightmare.

The Winning Strategy

Considering the aforementioned factors, it would be prudent to choose stocks with a low debt-to-equity ratio to ensure steady returns.

Yet, an investment strategy based solely on the debt-to-equity ratio might not fetch the desired outcome. To select stocks with the potential to provide steady returns, we have expanded our screening criteria to include additional factors.

Other Parameters:

Debt/Equity Less Than X-Industry Median: Stocks that are less leveraged than their industry peers.

Current Price Greater Than or Equal to 10: The stocks must be trading at a minimum of $10 or above.

Average 20-day Volume Greater Than or Equal to 50000: A substantial trading volume ensures that the stock is easily tradable.

Percentage Change in EPS F(0)/F(-1) Greater Than X-Industry Median: Earnings growth adds to optimism, leading to a stock’s price appreciation.

VGM Score of A or B: Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2 (Buy), offer the best upside potential.

Estimated One-Year EPS Growth F (1)/F(0) Greater Than 5: This shows earnings growth expectations.

Zacks Rank #1 or 2: Irrespective of market conditions, stocks with a Zacks Rank #1 or 2 have a proven history of success.

Excluding stocks that have a negative or a zero debt-to-equity ratio, we present our five picks out of the 22 stocks that made it through the screen.

The Pennant Group: It offers home health, hospice, and senior living services. On April 1, 2026, the company announced the acquisition of the real estate and operations of Arbor Rose Senior Living, an established senior living community located in Mesa, AZ, which will now be known as Lavender Lane Senior Living. This buyout should strengthen Pennant’s Arizona senior living portfolio, reinforcing its presence in the East Valley market.

The Zacks Consensus Estimate for PNTG’s 2026 sales indicates an improvement of 21.9% from the prior-year estimated level. The stock boasts a long-term (three-to-five years) earnings growth rate of 13%. It currently holds a Zacks Rank #2.

Casey’s General Stores: It offers a comprehensive range of products and services to meet the needs of its customers. In addition to fuel, the stores provide a wide variety of merchandise, including groceries, prepared food, snacks, beverages, tobacco products, health and beauty aids, school supplies, housewares, pet supplies, and automotive supplies. 

On March 9, 2026, the company announced its third-quarter fiscal 2026 results. Its quarterly earnings per share surged 49.8% year over year. During the quarter, Casey's Rewards surpassed 10 million members. 

The Zacks Consensus Estimate for CASY’s fiscal 2026 revenues indicates an improvement of 8.2% from the prior-year reported actuals. The stock boasts a long-term earnings growth rate of 17%. CASY currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Royal Bank of Canada: It is Canada's largest bank as measured by assets and market capitalization, and one of North America's leading diversified financial services companies. On March 11, 2026, the company revealed that it has acquired Toronto-based Pinch Financial Incorporated ("Pinch"), a fintech company offering innovative mortgage qualification technology.

The Zacks Consensus Estimate for RY’s fiscal 2026 revenues indicates an improvement of 8.6% from the prior-year estimated number. The stock boasts a long-term earnings growth rate of 11.5%. The stock currently carries a Zacks Rank #2.

Veralto Corp.: It provides water analytics, water treatment, marking and coding, and packaging and color services across the globe. On March 31, 2026, the company announced it has entered into a definitive agreement to acquire GlobalVision, which will be integrated into VLTO’s Esko business, building on their decade long partnership and embedding an AI augmented quality and compliance backbone directly into Esko's end to end, source to shelf packaging platform.

The Zacks Consensus Estimate for VLTO’s 2026 revenues indicates an improvement of 6.6% from the prior-year reported actuals. The stock boasts a long-term earnings growth rate of 8.4%. It currently carries a Zacks Rank #2.

Stantec: It provides professional consulting services in planning, engineering, architecture, interior design, landscape architecture, surveying, and geomatics. On April 7, 2026, Stantec revealed that it has been selected by the European Investment Bank (EIB) to deliver Advisory Support on Climate Adaptation, Resilience and Nature based Solutions in Environmental Sectors — a major initiative under the European Union’s InvestEU Advisory Hub. 

This assignment is expected to contribute to the acceleration of public environmental investments within the EU, notably in climate adaptation, resilience, and nature-based initiatives, through the provision of dedicated technical and financial advisory services.

The Zacks Consensus Estimate for STN’s 2026 revenues suggests an improvement of 12.5% from the year-ago reported level. The stock delivered a trailing four-quarter average earnings surprise of 1.50%. It currently carries a Zacks Rank #2.