Hey there, Fools. We’re back again to highlight a few stocks that have recently hit new 52-week lows. As a reminder, we do this because the surest way to investing success is by buying quality companies when everyone else is running away from them; while they’re being ignored and forgotten; or when they’re being sold at bargain-basement prices.
It’s never easy buying stocks with so much pessimism surrounding them. But in the market, it’s one of the only ways to truly “buy low.”
So, without further ado, let’s get to this week’s trio of losers.
Kicking off our list is Goldcorp (TSX:G)(NYSE:GG), whose shares hit a new 52-week low of $13 on Monday. In fact, the gold miner is now down a substantial 28% over the past three months versus a loss of just 1% for the S&P/TSX Composite Index.
Naturally, Goldcorp is being weighed down heavily by the slumping gold prices. But if you believe in the long-term prospects of the yellow metal, there’s good reason to remain bullish on Goldcorp.
As I mentioned early last month, management is making positive strides with its “20/20/20” plan — a company objective to boost gold production by 20%, increase gold reserves by 20%, and lower all-in costs by 20%. So, if you care to make a wager on gold, Goldcorp and its improving fundamentals seems like a particularly solid way to do it.
Our next slumping stock is Sleep Country Canada Holdings (TSX:ZZ), which hit a low of $27.96 just yesterday. Over the past year, shares of the bed retailer are off 22%, while the S&P/TSX Consumer Discretionary Index is down just 2%.
Sleep Country — which consistently posted double-digit top and bottom-line growth a few years ago — is slowing down of late. In Q2, earnings increased 9% as revenue grew 8% to $143.7 million. Meanwhile, the company’s same-store sales — a key metric for retailers — increased just 4.4%, down from 7.5% in the year-ago period.
The good news is that Sleep Country has posted 20 straight quarters of same-store sales increases. So, with a dividend yield of 2.5% and forward P/E in the low-teens, now might be a good time to buy into that consistent — albeit slowing — growth.
Our final faller this week is Interfor Corporation (TSX:IFP), whose shares hit a low of $18.67 last week. The decline has been swift: after a strong first half of 2018, the lumber company is down 25% over just the past three months.
Slumping lumber prices, as well as continued U.S.-China trade war concerns, are largely to blame for Interfor’s recent slump. But as far as operations go, the company seems to be humming. In Q2, total lumber production clocked in at a record 688 million board feet. Interfor also generated solid operating cash flow of $134 million.
To be sure, Interfor isn’t for the faint of heart — with a beta of 2.8, the stock has nearly three times the volatility of the overall market. But for long-term investors willing to take on some risk, Interfor is a potent play on the recovery of lumber prices.
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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 Brian Pacampara owns no position in any of the stocks mentioned.