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2 Stocks That Are Bargain Buys Today

One of the benefits of a lot of bearish activity is that it creates buying opportunities for investors that are not afraid to buy during adverse times. It’s really easy to buy stocks and invest when prices just keep going up and up, but that doesn’t always end well — just ask Bitcoin investors that thought the cryptocurrency was still a good buy at US$19,000.

Buying under difficult circumstances is a lot more challenging, especially if you see your portfolio dwindle in value, because odds are, you won’t be lucky enough to find the bottom and avoid having to see your stock drop further in price.

There are two stocks that stick out to me that have seen a lot more bearish activity than the index has recently, but that still have a lot of upside and could generate significant returns for investors that buy today.

Roots (TSX:ROOT) has lost nearly half of its value since its IPO and the stock is down more than 40% in the last three months alone. The culprit behind the recent decline in price is a poor earnings report in Q2 that showed minimal sales growth and a larger loss than the company incurred a year ago.

One reason I’m optimistic for Roots is that I look at how well Canada Goose Holdings has been able to grow its sales as proof that there could be a lot of potential for the Canadian-branded Roots clothing outside Canada.

Either way, even if you’re not sold on its growth prospects, it’s still a bit early to write off the stock as the sell-off appears to be excessive. At only slightly above its book value, Roots could be a cheap buy, and it’s also currently trading at 14 times its earnings over the trailing 12 months.

Stars Group (TSX:TSGI)(NASDAQ:TSG) is another stock that has recently been on a bit of a decline, also dropping around 40% since August. The company has been showing terrific growth lately, but a bad quarter that saw Stars Group record a big loss sent investors into selling mode.

A big reason I expect big things for the stock going forward is that it’s making big moves in the world of online sports betting, and with the U.S. recently overturning a ban on it, we could see the floodgates open as individual states can choose whether or not to allow it. That will create a lot more demand for Stars Group and will fuel a lot of growth.

Stars Group has been focused on the U.K. lately, but the U.S. market will offer significant potential down the road. Earlier this week, the National Hockey League (NHL) announced it would be partnering with MGM Resorts International, which would give it access to intellectual property and “real-time advanced game data.”  The deal is not exclusive and more could be on the way, not only with the NHL but other leagues as well.

Next week, Stars Group will release its Q3 earnings, and a big improvement there could send the stock soaring once again. It could be a great opportunity for investors to buy now while the share price is still near its 52-week low.

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Fool contributor David Jagielski owns shares of The Stars Group.

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