LEV:CC - 3 Stocks You'll Be Glad You Bought at These Prices
2024-04-12 15:45:00 ET
Sometimes, a stock you wouldn’t buy at a fair price seems worth buying when it’s adequately discounted. Other times, a discount may encourage you to buy a stock you already have in ample quantity in your portfolio, especially if it’s substantial enough to improve the pricing of your overall stake or contributes to the yield.
Regardless of how they may improve your portfolio, there are three stocks that almost everyone should look into right now for their discounted prices.
An EV stock
EV stocks garnered a lot of attention a few years ago by two types of investors — those interested in ESG (environmental, social, and governance) investing and others who wanted to leverage the initial hype of a budding technology.
However, many investors and stocks missed that window, including Lion Electric ( TSX:LEV ), which has been in almost a perpetual state of decline since its early days. Currently, it’s trading at just $1.7 a share, which indicates a 92% decline from its initial public offering price.
It’s important to understand that this is not a healthy discount, and you may need an adequate amount of risk tolerance to consider adding this stock to your portfolio. However, you may be glad that you bought this stock at its current rock-bottom price if it gains upward momentum and starts receiving bulk orders for large electric vehicles, particularly school buses (its core product).
A retail company
Canadian Tire ( TSX:CTC.A ) is one of the major retailers in Canada, with about 1,700 locations country-wide and multiple brands under its banner, including Sports Chek and Mark’s. It also has a decent market share in a relatively fragmented market, which cements its leadership status. As a well-known leader in the retail market with a robust loyalty program, Canadian Tire is a healthy business you can invest in.
It’s also a dividend aristocrat with a modest yield of 3%. The business model and reliable dividends are the primary elements of its appeal as the stock hasn’t offered much capital-appreciation potential in the last few years, and it’s currently trading at a discount of about 45% from its previous peak, with an inflated valuation.
However, as the economy strengthens and discretionary spending increases, Canadian Tire may experience organic growth, and hopefully, a stock recovery will follow. That makes the stock worth buying right now, in its beaten-down state.
A telecom company
While it’s not the top 5G stock in the country, BCE ( TSX:BCE ) is still the leader in the telecom sector, at least by market capitalization (and in a few other categories). It’s also heavily discounted right now, along with the other two telecom giants in the country, as the industry deals with some regulatory challenges.
While buying it right now, when we don’t know the full extent of the damage industry-wide challenges might do to the business may seem risky, the hefty 38% discount and an 8.9% yield make it a highly attractive buy right now.
The company has grown its payout for 14 consecutive years, and it’s highly unlikely to slash or suspend its dividends, so buying the stock now, at this highly discounted price, may be the smart thing to do.
- We just revealed five stocks as “best buys” this month … join Stock Advisor Canada to find out if Canadian Tire made the list!
Foolish takeaway
One big “if” when it comes to these three stocks is if they are tied to their recovery. A decent chance of recovery and eventual growth makes all three stocks appealing at their current prices, but if we remove this positive sentiment from the equation, the risk will far outweigh the benefits of buying the stocks, even the dividend payers.
The post 3 Stocks You’ll Be Glad You Bought at These Prices appeared first on The Motley Fool Canada .
Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .
2024