Investors can make money this summer by investing in reasonably priced stocks with the potential to deliver solid returns. Three stocks that are currently performing and selling for less than $7.00 at writing are Arc Resources Ltd. (TSX:ARX), Diversified Royalty Corp (TSX:DIV), and Rogers Sugar Inc. (TSX:RSI).
The companies are not the run-of-the-mill types; rather, they are firmly established in the respective industries. You can evaluate and assess the financial health before to determining whether the stocks are aligned with your investment appetite. The little money you spend can be double or triple well beyond the summer season.
High-dividend-paying energy stock
ARC Resources is an Oil & Gas E&P company holding interest in petroleum and natural gas properties and assets in Canada. Some of the assets are in the Montney properties located in Northern Alberta and Northeast British Columbia. Others are in Cardium properties in the Pembina area of Alberta.
After a forgettable 2015 and massive losses, ARC Resources has turned around to deliver consistent profits in the succeeding years. The shares of the $2.37 billion company are also gaining traction on the stock market as a result.
But more than anything else, the five-year average dividend yield of 4.77% is the clincher. Apart from the high-dividends, investors could realize market-beating returns well past the summer. Based on analysts’ forecasts, the potential price upside is about 102% to 142% from the current price of $6.71 for an unbeatable summer gain.
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Cheapest royalty stock
Diversified Royalty Corp. is a specialty finance stock that engages in the acquisition of royalties from multi-location businesses and franchisors in North America. The 329.5 million multi-royalty corporation is known for holding the Canadian and United States trademarks and other intellectual property rights.
These rights are related to the Original Joe’s, Elephant & Castle, and State & Main restaurant businesses. Net income for the last three years has been steady and averaging $10.8 million annually on annual average revenue of $25.3 million. For this year, the growth estimate is 50.0%.
The current stock price is $3.04 but with a potential gain of 55.6% according to market analysts. As of May this year, the dividend yield is 6.8%. This is the reason many TFSA investors are including DIV in their stock portfolios. For a measly investment, you can have a predictable cash flow.
The best summer deal
Investing in Rogers Sugar could be your best and most profitable deal this summer. You’re not taking a risk spending $5.82 per share. What you will get in return is a massive 6.15% dividend; there could also be a moderate price increase in the months ahead.
The $611.1 million sugar refiner and maker of maple products is financially healthy and has consistently turned in profits year after year. The business has been perennially strong without the threat of a slowdown in the years ahead. RSI can also jack up your passive income well into the winter season.
The cheap stocks will not only make your summer memorable, but will not even dent your holiday budget.
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 Christopher Liew has no position in any of the stocks mentioned.