Global disasters and pandemics have a way of testing and changing people. They bring out the best in some people and worst in others. This social behaviour might not be relevant to us Fools, but situations like these also get people to make some pretty massive mistakes. Some investors sell the bulk of their holdings, wiping the slate clean over years of capital growth.
Whether you are one of the investors who participated in the sell-off frenzy, or you are simply financially disciplined, the chances are that you might be sitting on some cash. The reason might be completely different, but if you have some extra cash, you might want to take that opportunity and buy some good stocks when they are at a discount.
If nothing else, the discounted purchase and eventual stabilization of the stock might help you offset some of the financial losses you incurred during the pandemic.
A communications company
Quebecor (TSX:QBR.B) is a company rooted deep in the community it operates in, which is evident in its name. The company started with the acquisition of a neighborhood newspaper in 1950 for a mere $1,500. And now, about 70 years later, it’s a $7.75 billion (market cap) empire that runs a telecom, media, sports, and entertainment business. Its founder is nicknamed the king of the popular press.
Quebecor’s share price has grown remarkably steadily since 2009. It’s had over 500% growth. During the current pandemic, the worst that the company’s stock Has fallen was 20%, and it’s already on its path to recovery. Currently, the company is trading at $30.4 per share. Its growth potential is evident from its five-year CAGR of 12.6%. Quebecor also pays dividends, but its history is erratic (in a good way).
Since 2015, the company has increased its quarterly payouts over 15 times from $0.0125 per share to $0.2000 per share. The current yield is 2.73%.
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An industrial company
Tormont Industries (TSX:TIH) operates in two major sectors: equipment and refrigeration. They are two very different sectors that cater to relatively different industrial needs, which offer Tormont a lot of operational diversification. Its stability is also augmented by the fact that it’s a Dividend Aristocrat, with seven years of consecutive dividend increases. Currently, the company is offering a yield of a modest 2.13%.
While it may not be a very attractive number, its dividend and capital growth surely are lucrative. In the last five years, the company increased its payouts by a decent 72%. At the same time, it grew its market value by almost 100%, bringing the CAGR to a sweet number of 14.86%. At the time of writing this, the company is trading at a 16% discount, and the price tag is now $60 per share.
An ironclad company
During recessions and market crashes, everyone looks towards gold and gold mining companies. But in that financial bias, other good mining businesses might get ignored. One of these businesses is Labrador Iron Ore Royalty. It’s a fund that holds 15% royalty in the Iron Ore Company of Canada on a very favourable distribution basis. Its dividends vary wildly from year to year. Right now, it’s offering a mad yield of almost 21.9%.
The fund is trading at just $15.5 per share. Its growth is nothing to scoff at. In the past five years, the company has grown its stock price by 86%.
The coronavirus market meltdown is still in an unprecedented position. Market gurus and analysts aren’t sure what the market will look like in a few weeks and what the long-lasting impact of the pandemic will be. But good companies with strong fundamentals and good management will have a better chance of recovering. And having a few such companies in your portfolio is likely to pay off big.
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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 Adam Othman has no position in any of the stocks mentioned.