Buying opportunities are happening again on the TSX. People with short-term and long-term financial goals can resume investing activities. The market is not yet as healthy as before, although signs of recovery are evident.
There are two stocks on my buy alert list. One can be a long-term hold for steady income, while the other is well positioned to deliver upsized returns. Likewise, the stock prices are too cheap to ignore.
Dividend all-star National Bank of Canada (TSX:NA) is the sixth-largest bank in Canada. This $21.97 billion bank has a dividend-growth streak of 10 years. The historical return over the past decade is 248.77%.
At the height of the market selloff in March 2020, the price sunk to $38.73. As of June 5, 2020, the stock is trading at $65.52 per share or a 69% climb. Year to date, National Bank shares are still down by 7.88%. If you take a position today, the dividend yield is 4.34%, which should be sustainable for another decade or more.
In Q2 fiscal 2020 (quarter ended April 30, 2020), net income dropped by 32% to $379 million versus the $558 million in the same quarter last year. The bank attributes the drop to the $84 million increase in credit loss provisions. All Big Six banks took this precautionary step due to the economic storm.
National Bank is most dominant in Quebec. The province has a well-diversified economy that fully supports local businesses. Its president and CEO Louis Vachon is confident the bank will prove resilient and defensive in the months ahead.
From gloom to bloom
I see BlackBerry (TSX:BB)(NYSE:BB) blossoming after the pandemic. The price of $7.38, as of this writing, is an excellent entry point. The reason I say this is that positive developments are happening.
If you will recall, BlackBerry was once the ultimate smartphone manufacturer. It was gobbling up market share globally during its heyday. The company never had it so good until competition caught up and threw BlackBerry into oblivion.
BlackBerry is no longer in the business of manufacturing smartphones. A comeback is looming via the enterprise Internet of Things (IoT) software market. The market is one of the most attractive in the 21st century.
The company is now leading the way in leveraging AI and machine learning. BlackBerry is providing innovative solutions in cybersecurity and data privacy. Governments and enterprises are the users of BlackBerry’s intelligent security software.
Thomas Eacobacci, a person with 20 years of global leadership experience, will sit as president on June 15, 2020. According to BlackBerry’s executive chairman and CEO, Eacobacci is the right man to steer the company to revenue growth and market expansion.
Market analysts are forecasting an 89.7% price appreciation in the next 12 months.
The TSX is slowly paring down the losses in 2020. Canada’s main stock index closed at 15,854.10 on June 5, 2020, which is a 41.19% rally from its all-time low of 11,228.50 posted on March 23, 2020.
More buying opportunities are coming
As lockdown measures relax and provincial economies restart, expect more buying opportunities. For now, the National Bank of Canada and BlackBerry are my logical choices.