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Fool Canada’s first 1,000%+ winner?

Our Chief Investment Advisor, Iain Butler, and a team of The Motley Fool’s most talented investors from across the globe recently embarked on an unprecedented mission:

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3 Undervalued Stocks I’d Buy With an Extra $15,000

One of the most difficult tasks we face as investors is finding the right stock at the right price when we are ready to make a purchase. In order to make things easier for you, I scoured the market and found three stocks that are trading at major discounts compared with their five-year averages, so let’s take a quick look at each to determine if you should buy one or more of them today.

1. WSP Global Inc.

WSP Global Inc. (TSX:WSP) is one of the world’s largest engineering consulting firms.

At today’s levels, its stock trades at just 18.7 times fiscal 2015’s estimated earnings per share of $2.15 and only 14.7 times fiscal 2016’s estimated earnings per share of $2.74, both of which are inexpensive compared with its five-year average multiple of 27.4.

With its five-year average multiple and its estimated 27.4% earnings growth rate in fiscal 2016 in mind, I think WSP’s stock could consistently command a fair multiple of at least 20, which would place its shares upwards of $54 by the conclusion of fiscal 2016, representing upside of more than 34% from current levels.

Also, the company pays a quarterly dividend of $0.375 per share, or $1.50 per share annually, which gives its stock a yield of about 3.7%.

2. Silver Wheaton Corp.

Silver Wheaton Corp. (TSX:SLW)(NYSE:SLW) is the world’s largest precious metals streaming company.

At today’s levels, its stock trades at just 21.7 times fiscal 2015’s estimated earnings per share of US$0.51 and only 19.8 times fiscal 2016’s estimated earnings per share of US$0.56, both of which are inexpensive compared with its five-year average price-to-earnings multiple of 32.9.

With its five-year average multiple and its estimated 9.8% earnings growth rate in fiscal 2016 in mind, I think Silver Wheaton’s stock could consistently command a fair multiple of at least 25, which would place its shares around $14 by the conclusion of fiscal 2016, representing upside of more than 26% from current levels.

In addition, the company pays a quarterly dividend of US$0.05 per share, or US$0.20 per share annually, which gives its stock a yield of about 1.8%.

3. Finning International Inc.

Finning International Inc. (TSX:FTT) is the world’s largest dealer of Caterpillar equipment, parts, and services.

At today’s levels, its stock trades at just 12.3 times fiscal 2015’s estimated earnings per share of $1.42 and only 11.9 times fiscal 2016’s estimated earnings per share of $1.47, both of which are inexpensive compared with its five-year average price-to-earnings multiple of 18.6.

With its five-year average multiple and its estimated 3.5% earnings growth rate in fiscal 2016 in mind, I think Finning International’s stock could consistently command a fair multiple of at least 15, which would place its shares upwards of $22 by the conclusion of fiscal 2016, representing upside of more than 25% from current levels.

Also, the company pays a quarterly dividend of $0.1825 per share, or $0.73 per share annually, which gives its stock a yield of about 4.2%.

Should you buy one of these undervalued stocks today?

WSP Global, Silver Wheaton, and Finning International are three very attractive long-term investment options. Foolish investors should take a closer look and strongly consider beginning to scale in to positions in at least one of them today.

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Fool contributor Joseph Solitro has no position in any stocks mentioned. The Motley Fool owns shares of Silver Wheaton. (USA). Silver Wheaton Corp. and Finning International are recommendations of Stock Advisor Canada.

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