3 Beaten-Down Stocks to Buy Right Now

Looking for a value play? If so, Silver Wheaton Corp. (TSX:SLW)(NYSE:SLW), Potash Corp./Saskatchewan Inc. (TSX:POT)(NYSE:POT), and RONA Inc. (TSX:RON) are great options.

| More on:
The Motley Fool

As investors know, finding the right stock at the right price can be a very difficult task. However, the recent downturn in the market has created a plethora of opportunities. Let’s take a look at three stocks that are now trading at inexpensive forward valuations compared with both their industry and five-year averages, so you can decide which would be the best fit for your portfolio.

1. Silver Wheaton Corp.

(All figures are in U.S. dollars)

Silver Wheaton Corp. (TSX:SLW)(NYSE:SLW) is the largest pure precious metals streaming company in the world. At today’s levels, its stock trades at 28.7 times fiscal 2015’s estimated earnings per share of $0.57 and 24 times fiscal 2016’s estimated earnings per share of $0.68, both of which are inexpensive compared with its industry average price-to-earnings multiple of 41.5 and the latter of which is inexpensive compared with its five-year average multiple of 27.4.

In addition, the company pays a quarterly dividend of $0.05 per share, or $0.20 per share annually, giving its stock a 1.6% yield.

2. Potash Corp./Saskatchewan Inc.

(All figures are in U.S. dollars)

Potash Corp./Saskatchewan Inc. (TSX:POT)(NYSE:POT) is the world’s largest manufacturer and distributor of fertilizer. At current levels, its stock trades at 17.7 times fiscal 2015’s estimated earnings per share or $1.82 and 16 times fiscal 2016’s estimated earnings per share of $2.01, both of which are inexpensive compared with its industry average price-to-earnings multiple of 19 and its five-year average multiple of 19.7.

Also, the company pays a quarterly dividend of $0.38 per share, or $1.52 per share annually, which gives its stock a 6.25% yield.

3. RONA Inc.

RONA Inc. (TSX:RON) is one of Canada’s largest retailers of home improvement products. At today’s levels, its stock trades at 14.6 times fiscal 2015’s estimated earnings per share of $0.95 and 12.8 times fiscal 2016’s estimated earnings per share of $1.08, both of which are inexpensive compared with its industry average price-to-earnings multiple of 17.2 and its five-year average multiple of 23.4.

In addition, the company pays a quarterly dividend of $0.04 per share, or $0.16 per share annually, giving its stock a 1.15% yield.

Which of these stocks should you buy today?

Silver Wheaton, Potash Corp., and RONA are three of the most attractive investment options in their respective industries. Foolish investors should take a closer look and strongly consider establishing positions in at least one of them today.

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.

Fool contributor Joseph Solitro has no position in any stocks mentioned. The Motley Fool owns shares of Silver Wheaton. (USA). Silver Wheaton is a recommendation of Stock Advisor Canada.

More on Investing

A cannabis plant grows.
Cannabis Stocks

Canopy Growth Stock Is Rising But I’m Worried About This One Thing

Canopy Growth stock is soaring as the legalization effort makes real progress in both Germany and the United States.

Read more »

young woman celebrating a victory while working with mobile phone in the office
Investing

3 Roaring Stocks to Hold for the Next 20 Years

These top TSX stocks are excellent long-term buys, given their multi-year growth potential and solid underlying businesses.

Read more »

Two seniors float in a pool.
Dividend Stocks

TFSA: How to Earn $1,890 in Annual Tax-Free Income

Plunk these investments into your TFSA to earn passive income and avoid the taxman.

Read more »

grow dividends
Investing

Here’s My Top 3 TSX Stocks to Buy Right Now

Even though the TSX has been rising, there are still some good bargains out there. Here are three top compounding…

Read more »

Target. Stand out from the crowd
Investing

Prediction: This Canadian Growth Stock Could Double by 2030

Alimentation Couche-Tard (TSX:ATD) is a top growth stock that could do well over the next six or so years.

Read more »

Businessman holding AI cloud
Tech Stocks

Could Investing $20,000 in Nvidia Make You a Millionaire?

Nvidia stock has made investors millionaires in the last 10 years. Is it too late to invest to become a…

Read more »

Engineers walk through a facility.
Dividend Stocks

1 TSX Stock I Wouldn’t Touch With a 10-Foot Pole

AtkinsRéalis (TSX:ATRL) is one TSX stock I'd never invest in.

Read more »

money cash dividends
Stocks for Beginners

Have $500? 3 Absurdly Cheap Stocks Long-Term Investors Should Buy Right Now

If you're looking for cheap stocks, these three have a huge future ahead of them, all while costing far less…

Read more »