What’s up guys, it’s wiz.
Welcome back to the channel. If you are new, I am a Canadian investor. I cover a whole lot of information about investing in Canada and do research into our Canadian market. I dive into growth investing, dividend investing and Canadian small caps / penny stocks. Today, I will be going over some value stocks that should be on your watchlist during this market. Market has been overall red last week and continuing this week. So I will showcase 3 Canadian stocks that can provide a lot of value in the long term and are pretty cheap currently. For new investors, you need to join Wealthsimple Trade if you are looking to start investing and live in Canada. If you use my link in the description to join Wealthsimple, you get 2 free stocks worth up to 4500$ so do not miss out.
Market crashes are rare, but cheap discounted value stocks, not so much. There is a decent number of undervalued or discounted stocks on the market at any given time. But the best part is when some stocks have both going for them. They both offer value over the long term and are currently undervalued and priced under what they are worth. Here are three value and cheap stocks that should be on your radar right now.
An e-commerce stock. The first stock is Lightspeed (ticker symbol LSPD), which is experiencing the heaviest plunge since inception. In the market crash, the stock only dipped 27% at max. In contrast, it has fallen about 79% so far, and there is no recovery pattern in sight for now. This is due to multiple factors, the most prominent of which would be the overdue correction after the post-pandemic growth, the tech fall as a whole, and a short seller’s report pointing out discrepancies and flaws in the Lightspeed stock. The company saw a leadership change following the series of events, and a new CEO was appointed. It also sought to improve the platform and enhance its offerings, such as its TikTok integration. One ray of light for this stock might be a massive insider buying trend that was seen in the stock. It may be an indication of a positive recovery cycle and a signal to buy now. Add this to your watchlist and put in that research, this Canadian stock may have great potential in the long term.
An undervalued steel stock. The second stock is honestly heavily undervalued, Stelco (ticker symbol STLC), which was once Canada’s premier steel producer, is a good option to consider. The stock is not nearly as discounted as Lightspeed. In fact, it’s currently trading at near its all-time high. However, the price-to-earnings of 2.1 indicates the extent of its undervaluation. Stelco is a decent buy for its dividend yield (which is currently at around 2.9%) and its capital growth potential (under the right circumstances). The stock might go through a correction phase which may push the valuation much further down than the 16% (from its peak) it is now. You may also lock in a much better yield than the current one. My opinion is to add this one to the watchlist and see where the next week or two takes it. It’s a high reward risk play for the long term if you are bullish on steel, and this particular company is making a comeback.
A discounted hydrogen stock. While it doesn’t get as much attention as renewables, hydrogen may come to play an essential role in the green future of our world. The third and final stock is Ballard Power Systems (ticker symbol BLDP), it is the perfect type of a company that may shine quite brightly in the future. The stock did experience incredible growth between 2019 and its 2021 peak, when it saw its market value rise well over 1000%. However, the fall has been just as hard. The stock is currently trading at a 71% discount from its 2021 peak, and this discount tag might become heavier if the fall continues. It would be a good idea to track the fall and buy just before the long-term upward momentum becomes permanent. Thanks to its business model and focus, the stock may experience powerful growth in a greener future market. This Canadian stock is the most interesting to me with its long term potential, a great one to put on the watchlist and do some research in.
Stelco is the only one out of the three that is an undervalued stock. Still, the discount of Ballard and Lightspeed is just as compelling a reason to buy these companies as the undervaluation of Stelco. When bought at a discount and held for the long term, all three companies could be powerful assets in your portfolio. As mentioned, if I were to pick only one of these Canadian stocks from the three I went over, I would put my money in BLDP. Its rise in value from 2019 to 2021 is not out of luck. The company has been putting in the work, and I believe a hydrogen company like this one can have high long term benefits. I talked about a bit before, I would personally wait a bit to see where the market is heading, overall we know the market is going to do not so well during the current tensions we are facing in Europe, so I would wait and evaluate Ballard Power Systems during the next 2 weeks, and if you are seeking to buy right now, try to do it in intervals and not purchase the maximum amount of shares you can in one go.
Hope you guys enjoyed these value and relatively cheap Canadian stocks I went over. Please watch my previous videos on Canadian stock recommendations and let me know of any Canadian stocks you want me to look into and give my opinion on. Let me know in the comments, since I really want to expand my knowledge in the Canadian market. If you did enjoy this video, leaving a like really helps grow the channel! Thanks for watching, I’ll see you guys in the next video!