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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:

To identify the 20 Canadian small-cap companies they believe have the best shot at earning investors like you gains of 1,000%+ over the coming years.

For the next few days only, you can get the names and full details on these 20 potential “10-baggers” when you join Iain and his team in a first-of-its-kind project they have dubbed Discovery Canada 2017.

4 Undervalued Stocks With Great Dividends

As a fundamental investor, I’m always on the lookout for high-quality companies whose stocks are trading at discounted levels and have great dividends and, after a recent search of the market, I came across four very attractive opportunities. Let’s take a quick look at each, so you can determine if you should buy one of them today.

1. Domtar Corp.

Domtar Corp. (TSX:UFS)(NYSE:UFS) is one of the world’s leading providers of fibre-based products. Its products include communication, specialty, and packaging papers, market pulp, and absorbent hygiene products.

Its stock currently trades at just 13.8 times fiscal 2016’s estimated earnings per share of US$2.54 and only 10.1 times fiscal 2017’s estimated earnings per share of US$3.48, both of which are inexpensive compared with its trailing 12-month price-to-earnings multiple of 20.3, its five-year average multiple of 17.7, and its industry average multiple of 28.7.

Additionally, the company pays a quarterly dividend of US$0.415 per share, or US$1.66 per share annually, giving its stock a yield of about 4.7%. Investors must also note that it has raised its annual dividend payment for five consecutive years, and its two dividend hikes since the start of 2015, including its 6.7% hike in February 2015 and its 3.8% hike in May of this year, have it on pace for 2016 to mark the sixth consecutive year with an increase.

2. Saputo Inc.

Saputo Inc. (TSX:SAP) is the largest dairy processor in Canada, and it’s one of the 10-largest dairy processors in the world. Its products include cheese, fluid milk, extended shelf-life milk and cream products, and dairy ingredients, and its brands include Saputo, Dairyland, DairyStar, La Paulina, Neilson, and Woolwich Dairy.

Its stock currently trades at just 21.7 times fiscal 2017’s estimated earnings per share of $1.77 and only 19.4 times fiscal 2018’s estimated earnings per share of $1.98, both of which are inexpensive compared with its trailing 12-month price-to-earnings multiple of 25.5, its five-year average multiple of 35.8, and its industry average multiple of 26.9.

Additionally, the company pays a quarterly dividend of $0.135 per share, or $0.54 per share annually, giving its stock a yield of about 1.4%. A 1.4% yield is not high by any means, but investors must note that it has raised its annual dividend payment for 16 consecutive fiscal years, and its strong financial performance could allow this streak to continue in fiscal 2017.

3. WSP Global Inc.

WSP Global Inc. (TSX:WSP) is one of the world’s leading providers of sustainable consulting in the built and natural environment, which involves designing, engineering, and managing projects in numerous industries. It has operations across North America, South America, Europe, Asia, Africa, and Australia.

Its stock currently trades at just 16.7 times fiscal 2016’s estimated earnings per share of $2.36 and only 14.3 times fiscal 2017’s estimated earnings per share of $2.76, both of which are inexpensive compared with its trailing 12-month price-to-earnings multiple of 19.7, its five-year average multiple of 26.5, and its industry average multiple of 26.

Additionally, the company pays a quarterly dividend of $0.375 per share, or $1.50 per share annually, giving its stock a yield of about 3.8%. Investors must also note that it has maintained this annual rate since 2012, and its ample free cash flow generation could allow it to continue to do so going forward or allow it to raise its dividend in the near future.

4. Empire Company Limited

Empire Company Limited (TSX:EMP.A) is one of Canada’s largest owners and operators of grocery stores through its Sobey’s banner with more than 1,500 locations across every province. It also holds a 41.5% ownership stake in Crombie Real Estate Investment Trust, which is one of Canada’s largest owners and managers of commercial real estate with 261 retail and office properties across the country.

Its stock currently trades at just 13.5 times fiscal 2017’s estimated earnings per share of $1.42 and only 12.2 times fiscal 2018’s estimated earnings per share of $1.57, both of which are inexpensive compared with its trailing 12-month price-to-earnings multiple of 20.5, its five-year average multiple of 16.2, and its industry average multiple of 36.5.

Additionally, the company pays a quarterly dividend of $0.1025 per share, or $0.41 per share annually, giving its stock a yield of about 2.1%. A 2.1% yield is not high by any means, but investors must note that it has raised its annual dividend payment for 21 consecutive fiscal years, and its 2.5% hike last month has it on pace for fiscal 2017 to mark the 22nd consecutive year with an increase.

Stock buy alert hits astounding 96% success rate!

The hand-picked investing team inside Stock Advisor Canada, recently issued a buy alert for one special type of "bread-and-butter" stock where The Motley Fool U.S. has banked profits on 23 out of 24 recommendations. Frankly, with an astounding 96% success rate that has delivered average returns of 260%, chances are this new pick could deliver life-changing returns as well. Because the team at Stock Advisor Canada fully embraces the same time-tested investing philosophies that have led to countless Motley Fool winners globally. So simply click here to unlock the full details behind this new recommendation and join Stock Advisor Canada.

*96% accuracy includes restaurant stock recommendations from Motley Fool U.S. services Stock Advisor, Rule Breakers, Hidden Gems, Income Investor and Inside Value since each services inception. Returns as of 5/27/16.

Fool contributor Joseph Solitro has no position in any stocks mentioned.

NEW! This Stock Could Be Like Buying Amazon In 1997

For only the 5th time in over 14 years, Motley Fool co-founder David Gardner just issued a Buy Recommendation on this recent Canadian IPO.

Stock Advisor Canada’s Chief Investment Adviser, Iain Butler, also recommended this company back in March – and it’s already up a whopping 57%!

Enter your email address below to find out how you can claim your copy of this brand new report, “Breakthrough IPO Receives Rare Endorsement.”

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