When looking for TSX stocks with major value, it’s crucial investors don’t ignore the quality of the stocks. Often the best stocks will be sold off the least. And consequently, the worst stocks will be the ones suffering the most substantial setbacks in a market crash.
This makes looking at the discount in the stock alone a dangerous strategy. It’s much better to have an idea of which high-quality businesses you would like to own. Then only buy the top TSX stocks that match your investment criteria when they offer significant value.
By doing this, you ensure that you’re only buying the highest-quality companies. Quality is much more important than the price for long-term investors — especially when you consider how much top stocks can appreciate over time.
Both these TSX stocks today are high-quality businesses that will be exceptional long-term performers. They are also some of the most attractive value stocks on the TSX, making them the top stocks to buy right now.
Long-term TSX growth stock
Park Lawn (TSX:PLC) is a deathcare services company that owns and operates cemeteries and funeral homes across North America.
The company has been aggressively growing its portfolio over the last few years. Recently, however, it’s shifted to focus more on improving its margins.
Deathcare is an industry that is generally defensive. Despite many restrictions due to COVID-19 impacting funeral services, a lot of the other services in the industry continue to be essential. Because of this, Park Lawn likely won’t see that much of an impact to its revenue.
Despite the defensive nature of the business it operates in, the stock has lost more than a third of its value. This is because, before the market crash, Park Lawn was an exceptional growth stock. From 2015 to 2020, Park Lawn’s share price grew by more than 110%.
The problem is, the stock traded with such a premium, it was naturally vulnerable to a major selloff in a market crash.
The good news is that at these prices, the stock is a steal. And investors can gain exposure to this top long-term growth stock that will simultaneously protect your capital.
At roughly $18.50, Park Lawn remains well off its highs, offering significant value for one of the best long-term growth stocks on the TSX.
Fuel retailer stock
Parkland Fuel (TSX:PKI) is a supplier and marketer of petroleum products in addition to being a convenience store operator. The company has a diversified group of businesses that span all across North America.
Although normally this business would be defensive, in these unprecedented circumstances, with so many people ordered to stay home, demand for fuel has dropped off significantly.
This, however, is only a short-term issue, and opportunistic investors will see the resulting 40% discount as a major long-term opportunity.
Parkland Fuel saw almost identical growth to Park Lawn from 2015 to 2020, up 120% as it rapidly expanded its operations. This growth is significant and shows how Parkland’s stock can be one of the fastest-growing stocks on the TSX.
So, this discount is an excellent opportunity for investors to buy this top defensive stock. Parkland shares haven’t been this cheap since 2017 and early 2018.
On top of everything else, the business has strong financials and pays a dividend, which yields more than 4.4% at current prices.
Together with its growth potential, appealing dividend yield, and significant value, Parkland is one of the most attractive dividend-growth stocks on the TSX.
Both these companies present significant value for long-term investors and are among the top TSX stocks to buy today.
With their industry economics and robust operations, they can be relied upon for years. So, while they remain on sale, purchasing these top long-term TSX stocks is a great idea.
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 Daniel Da Costa has no position in any of the stocks mentioned.