You are currently viewing 3 Cheap Canadian Stocks to Buy Amid the Recent Pullback – The Motley Fool Canada

3 Cheap Canadian Stocks to Buy Amid the Recent Pullback – The Motley Fool Canada

Which service is right for you?
The pullback in these three Canadian stocks offers excellent buying opportunities.
Image source: Getty Images
Amid the resurgence of COVID-19 cases worldwide due to the new variant, Omicron, the equity markets have turned volatile over the last couple of days. The S&P/TSX Composite Index has fallen by over 2% in the previous two trading days. Despite the correction, the benchmark index trades 0.5% higher for this month.
However, the following three Canadian stocks have witnessed a significant selloff this month and have lost over 10% of their stock value. Meanwhile, the steep correction offers an excellent entry point for long-term investors, given their healthy growth prospects.
First on my list is Nuvei (TSX:NVEI)(NASDAQ:NVEI), which has lost over 17% of its stock value this month and trades 31.8% lower from its September highs. The concerns over its high valuation appear to have dragged the stock down. However, its growth prospects look healthy. Digital transactions are increasingly becoming popular amid growing online shopping, benefiting Nuvei, which offers electronic payment services.
Meanwhile, Nuvei is also working to introduce innovative products, expand its geographical presence, and make strategic acquisitions to drive growth. Through Faster Payments and Instant SEPA technologies, it has strengthened its position in the U.K. and Europe, respectively. It also recently received a licence to service online betting and iGaming operators in Connecticut, Louisiana, and Arizona. Additionally, through the recent acquisition of Simplex, the company offers an infrastructure for its clients to transact using over 45 cryptocurrencies and non-fungible tokens.
So, given its multiple growth factors and the steep correction in its stock price, I am bullish on Nuvei.
Goodfood Market (TSX:FOOD) has lost close to 40% of its stock value this month. The weak third-quarter earnings and investors’ skepticism over its growth prospects amid the reopening of the economy has dragged its stock price down. Amid the steep correction, the company is trading at an attractive valuation, with its forward price-to-sales multiple standing at 0.9.
However, I believe investors should utilize the sharp pullback to accumulate the stock to earn higher returns over the next three years, given its healthy growth prospects. Given the convenience and accessibility of online shopping, I expect the demand for Goodfood Market’s services to sustain, even in the post-pandemic period. Meanwhile, the company plans to construct 13 fulfillment facilities across Canada to increase its delivery speed. It is also expanding its product offerings, venturing into new markets, and increasing its production capabilities to drive growth.
This month, Lightspeed Commerce (TSX:LSPD)(NYSE:LSPD) has lost over 43% of its stock value amid rising net losses and a weak outlook. In its recently posted second quarter of fiscal 2022, the company’s net losses increased from US$19.5 million to US$59.1 million. Further, the company’s management issued weaker guidance for this fiscal due to the ongoing supply-chain issues. Despite its near-term challenges, the company’s long-term growth prospects look healthy.
The increased adoption of online shopping has created a multi-year growth opportunity for Lightspeed Commerce. In the second quarter, its gross transaction value increased by 123% to US$18.8 billion, while the total number of customer locations rose to 156,000. Additionally, it is expanding its services to new markets and focusing on launching innovative new products to increase its customer base and average revenue per customer. With cash and cash equivalents of US$1.2 billion, the company is well equipped to support its growth initiatives and future acquisitions. So, given its healthy outlook, I expect Lightspeed Commerce to outperform over the next three years.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
The Motley Fool owns shares of and recommends Nuvei Corporation. The Motley Fool recommends Goodfood Market Corp and Lightspeed POS Inc. Fool contributor Rajiv Nanjapla has no position in any of the stocks mentioned.
November 30, 2021 | Sneha Nahata
The resurgent coronavirus continues to add uncertainty, leading many to believe that a stock market correction could be in the…
Read more »
November 30, 2021 | Amy Legate-Wolfe
Lucid Group (NASDAQ:LCID) shares continue to rise on the rebound in Electric Vehicle (EV) stocks. Lucid is one of the…
Read more »
November 30, 2021 | Jed Lloren
At this point, it would be very impressive if you’ve never heard of Shopify (TSX:SHOP)(NYSE:SHOP). A company that needs no…
Read more »
November 30, 2021 | Christopher Liew, CFA
The technology sector powered the TSX during the COVID year but took a breather in 2021 in favour of energy…
Read more »
November 30, 2021 | Kay Ng
The Tax-Free Savings Account (TFSA) has been available since 2009. I hope, by now, Canadian investors know that the TFSA…
Read more »
November 29, 2021 | Puja Tayal
The cryptocurrency market is once again facing turbulence, as its biggest customer base faces a regulatory crackdown. India has the…
Read more »
November 29, 2021 | Amy Legate-Wolfe
Kinaxis (TSX:KXS) continues to climb, with shares up 14% year to date and 64% since its lows early on in…
Read more »
November 29, 2021 | Kay Ng
Lightspeed (TSX:LSPD)(NYSE:LSPD) stock is sometimes referred to as a smaller version of Shopify stock. The tech stocks have even moved…
Read more »
View All
Returns since inception, October 2013. Current as of November 30, 2021.
© 2021 The Motley Fool Canada, ULC. All rights reserved.

source

Laisser un commentaire