The best-value stocks in Canada are in a constant state of flux, primarily because of price fluctuations and occasionally due to spikes in revenues/profits. Therefore, if held long enough, these best value stocks in Canada are an excellent starting point if held for long enough. On the other hand, if value investing is not a prudent enough strategy for your tolerance of risk, then Canada’s best defence stocks may be a better fit.
The fact you are looking at Canada’s best stocks shows that you think there is value to be found right here at home. The top 10 Canadian stocks listed below are no slouch, and they are likely to deliver some impressive returns. Keep in mind that we chose the Canadian stocks featured in this right-wing article, emphasizing growth first.
When looking for the best Canadian stocks to buy right now, it pays to consider current economic challenges. If you want to make a short-term gain on Canada’s best-growing stocks, buying growth-oriented stocks could be the best choice. Canadian investors have plenty to think about in light of the current economic situation regarding deciding how and when to buy stocks. Whether you are more concerned with a short-term capital appreciation or long-term dividend growth, it is essential to know if the stock is performing well, turning a profit, paying a dividend, or going down.
Investing in sectors with a strong stock performance provides a realistic expectation for future gains. Even if you find that calculating the exact intrinsic value for a stock is hard, sticking with metrics such as P/B and P/E may help you spot better-value stocks you can hold long-term to achieve a fair amount of gains. It is important to note that although discounted stocks are also typically undervalued (since prices drop, pushing the values of P/E and P/B ratios lower), this is not always the case, so it is wise to test your valuation metrics even if you are facing significant price discounts.
While most Canadian best-value stocks are estimated/picked using valuation metrics, there are a few that may fall short of the criteria. If you are looking for some of the best value stocks to buy right now, here are the top three, all trading at under $20 per share. Today, let us look at two Canadian value stocks that can be bought at bargain prices by a Motley Fool investor and held for decades.
Top Canadian Value Stocks
These top 20 stocks on the TSX are starting points for your research and are not meant to serve as recommendations for buying any specific stocks. We are saving the real best-of-the-best as far as Canadian stocks go and the research tools you will enjoy for Stocktrades Premium Members.
Our almost-dual-market S&P/TSX team, Stock Advisor Canada, has just released its Top 10 Starter Stocks of 2022, which we think can serve as the launchpad of any portfolio. If you are feeling bullish on stocks for 2021 but are unsure of where to begin, this list of the 20 best stocks on the TSX to buy now might be worth keeping an eye on. Financial, gold, and energy sector stocks were among the best Canadian stocks to buy in 2020.
Thanks to strong uptrends and sound financials, many stocks are reasonably attractively priced now, but fewer are great buys. This has caused a shift away from growth stocks toward value stocks, with investors seeking refuge in quality businesses with appealing fundamentals and low share prices. As a result, some stocks have dropped significantly due to lost revenues, while others have skyrocketed, giving way to Canada’s best stocks. Generally, Canadian stocks and the Toronto stock exchange have had a bad reputation for returns.
Investing in the stock market can be a wild ride, with many ups and downs, even during good times. Of course, we know the stock market will get better over time, but the price of stocks will swing up and down on any given day, providing investment opportunities. In addition, the opportunities will change each month, so it is essential to take a systematic approach to determine which dividend stocks are opportunities.
If your investment strategy calls for dividend securities, you want to populate your portfolio with stocks paying the highest dividends. Dividend growth investing works, and you can build healthy retirement income, but you need to purchase individual stocks. If you are uncomfortable holding individual stocks, you can always buy dividend ETFs or look at various passive income ideas for creating a retirement income. For revenue, look for dividend stocks with dividend yields close to 4%, dividend growth rates near 6%, with dividend increases for at least five years (the Canadian Dividend Aristocrat).
The dividend yield is an excellent proxy for how good the stock is doing and how much of a return you are getting from investing in that specific company. It is trading at a little under $2000 a share, has an enterprise value-to-revenue ratio of 7.94, and has a P/E ratio of 6.08. However, it is recovering now, and with the share price not moving, this is one of the best stocks for value buying. With Cineplex recovering so quickly but still trading at an undervalued valuation, it is easily one of the best value stocks to buy.
Over its last 26 years of growth, Enbridge has grown its annual payout by 10% compounded, making it among Canada’s best dividend stocks in this regard. Over the last ten years, Royal Banks has grown it 8 % compounded yearly, a higher rate than most Canadian dividend stocks on this list. As a result, Royal Banks has returned more than $19 billion – equivalent to $15 a share – to shareholders since 2004.
At approximately $131.50 a share, Royal Bank shares are trading at a P/E ratio of 11.49. With shares selling for just 5.4 times the forward price-to-earnings (P/E) ratio, the stock is super-cheap.
The company most recently raised quarterly distributions by one penny, to 13 cents per share, beginning with its distribution in March 2021. As a result, no one winning strategy for finding what experts may describe as the top-performing Canadian stocks on the TSX. Instead, your goals and circumstances are the most significant considerations.