Many investors entered the summer season worried about a potential market crash. Equities have gained significant momentum since the sharp correction in the early spring. However, the state of the broader economy is still suspect. Today, I want to look at three undervalued stocks that have recently sent off buy signals. Should you look to add these stocks to your portfolio now? Let’s jump in.
Storm Resources: Undervalued stock?
Storm Resources (TSX:SRX) is a Calgary-based crude oil and natural gas exploration company. Its shares have dropped 2.4% in 2020 as of close on July 23. Oil and gas stocks were the first to be pummeled during the late winter and early spring correction. These stocks took an extra hit due to the oil price war between Russia and Saudi Arabia.
The company released its first-quarter 2020 results on May 12. Production came in at 23,946 bo/e per day, which represented a 7% increase from the previous quarter. It was also up 21% from the previous year. Funds flow came in at $16.9 million, or $0.14 per share, which was mostly flat from Q1 2019.
Shares last possessed a price-to-earnings (P/E) ratio of 9.1 and a price-to-book (P/B) value of 0.4. Storm Resources looks like an undervalued stock in the energy sector right now.
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Is it worth picking up this entertainment stock in July?
Earlier this month, I’d discussed whether Corus Entertainment (TSX:CJR.B) was worth buying. Shares of Corus have dropped 52% in 2020 so far. The third quarter of fiscal 2020 was something of a mixed bag for Corus.
Consolidated revenues declined 24% for the quarter and 9% in the year-to-date period. Meanwhile, segment profit dropped 35% and 13%, respectively. However, Corus reported that it saw improved viewership and engagement across its platforms in the quarter. The slump in revenue was largely due to advertisers withdrawing during a turbulent period.
Corus is fighting to turn a profit, but it did hit one marker of an undervalued stock this past week. Shares slipped below an RSI of 30 to kick off the month of July. This put Corus in technically oversold territory. There were some positive takeaways from its most recent quarter. Corus offers nice value in late July.
One undervalued bank stock I still love this summer
Canadian Western Bank (TSX:CWB) is a regional bank that is focused in the western part of Canada. Back in early May, I’d suggested that Canadian Western looked like an excellent value add for income investors. Shares have climbed 22% over the past three months as of close on July 23.
In Q2 2020, Canadian Western achieved total revenue growth of 2% to $214 million. Meanwhile, loans and branch-raised deposits were up 7% and 20%, respectively. This regional bank boasts a fantastic balance sheet and an impressive track record. It last declared a quarterly dividend of $0.29 per share, representing a strong 5% yield. Canadian Western has delivered dividend growth for 28 consecutive years.
Shares of Canadian Western last had a P/E ratio of 7.7 and a P/B value of 0.7. This is very attractive value territory for an elite dividend stock on the TSX. Canadian Western is still worth scooping up today.
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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 Ambrose O'Callaghan has no position in any of the stocks mentioned.