2 Perfect Stocks That You Should Buy or Sell While You Still Can

Corus Entertainment Inc. (TSX:CJR.B) posted dismal quarterly results and slashed its dividend, while Home Capital Group (TSX:HCG) nearly averted a collapse last year. Could the two be emerging as viable investments for value-minded investors?

| More on:
Dice engraved with the words buy and sell

Image source: Getty Images.

The market is full of incredible investment opportunities. From long-term dividend investments that will provide a comfortable retirement for years to come, to the bank that is defying all odds and becoming an incredible growth machine with each passing quarter, finding the perfect mix of investments takes time.

But what about the stocks with a less-than-stellar quarter or two? Should you sell to minimize your losses or buy at the current low and dollar-average down?

The answer to that varies based on the investment, so let’s take a look at two stocks that recently had very disappointing results.

Corus Entertainment Inc. (TSX:CJR.B) is a name that has been mentioned often in the past few weeks, particularly as the company’s dismal results from the most recent quarter resulted in a sell-off on the stock, which was accelerated as the company announced it was slashing its dividend by 80%. Ouch.

Corus’ stock price has so far dropped over 65% this year, which begs the question, should investors consider investing in Corus?

That drop was primarily attributed to disappointing losses and the company slashing its dividend, neither of which is likely to occur again.

In the case of Corus’ results, the net loss of $4.49 per share in the most recent quarter was significant, but the company’s stated intent to use technology in serving relevant ads sounds like a promising solution to a long-standing problem at the company.

To put it another way, the stock may have bottomed out, and given the deep cut to its dividend, the company should be in a stronger financial position to pay down debt and become profitable.

Alternatively, if the ongoing NAFTA negotiations result in opening up Canada’s media market further to foreign investment, one of the U.S. networks could jump over the opportunity to buy into Corus at a heavily discounted rate.

Either way, Corus could be a value-stock opportunity in waiting, assuming that we truly are at the bottom.

Home Capital Group (TSX:HCG) is another stock on the low that’s full of potential. Year-to-date the stock has dropped nearly 10%, which is really quite generous considering the two-year drop on the stock weighs in at over 45%.

After a mortgage underwriting scandal nearly bankrupted the company last year, progress on improving company financials has been slow but steady. As of the second fiscal of 2018, deposits amounted to $12.5 billion, representing a 3% uptick over the previous quarter.

Mortgage values saw a similarly minor uptick in the quarter of 2%, but some of that anemic growth could be attributed to the white-hot real estate market finally beginning to cool down.

Home Capital has come a long way since Warren Buffet extended a $2 billion lifeline to the company, and could very well emerge as a viable value-investment option for growth-seeking investors.

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 Demetris Afxentiou has no position in any stocks mentioned.  

More on Investing

top TSX stocks to buy
Dividend Stocks

Beat the TSX With This Cash-Gushing Dividend Stock

This dividend stock has been absolutely crushing the TSX 60 and looks like it will continue to do so while…

Read more »

money cash dividends
Stocks for Beginners

Where to Invest $10,000 in April 2024

If you've already created a diversified portfolio and are looking for more options from a windfall, here is where I…

Read more »

data analyze research
Investing

The Ultimate TSX Stock to Buy With $1,000 Right Now

Brookfield Asset Management (TSX:BAM) is one of the best Canadian stocks to buy for those looking to put capital to…

Read more »

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

3 CRA Benefits Most Canadians Can Grab in 2024

You can save on taxes by claiming the dividend tax credit on Fortis Inc (TSX:FTS) shares.

Read more »

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 »