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Earnings Season: 3 Top TSX Stocks to Buy the Dip

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Investors looking for the best TSX stocks to buy today have some strong options. Canada’s biggest telecommunications name are among the top stocks currently going on sale at the moment. In fact, a market-wide value opportunity could be in the making. Just as earnings from this year’s dire second quarter are being reported, a tentative recovery from pandemic stressors is picking up steam.

Get ready for telecom bargains

Packing more than one telecom stock in a portfolio brings the risk of overexposure. However, a TSX portfolio would benefit from having at least some exposure to this sector. Investors who are considering adding shares in one of Canada’s major wireless names have some distinct advantages.

Rogers Communications (TSX:RCI.B)(NYSE:RCI) brings sports and related media to the table, for instance. Meanwhile, BCE is a play for content streaming.

It might behoove an investor to take a “wait and see” approach, though. Earnings season has just begun for Canadian telcos. By the middle of next month, Canadian investors will have a clear picture of this sector’s overall performance.

Until then, however, investors can choose to build or reduce exposure to individual companies based on reports as and when they come.

Indeed, one big name is already on sale. Earlier in the month, I wrote, “An already weakened Rogers Communications is due to dish the dirt on its second-quarter results this Wednesday. After that, investors should look out for post-earnings dips from Telus on July 31, and then BCE on August 6. All three are strong names to buy on the cheap for an eventual post-pandemic recovery.”

Since then, Rogers did indeed release a fairly dismal report that caused its share price to ditch 5% for the week. A standout Q2 blemish saw roaming revenue down 90%. Rogers stores were shuttered during the second quarter, and its sports teams temporarily sidelined.

Some of these stressors are likely to continue weighing on Rogers’ income. And the bad news is likely to spread, too, leaving the entire telecom sector in a slump.

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Quality stocks are going on sale

But there is a clear case to be made for buying into value opportunities here. Rogers is a high-quality name, and a must-buy stock for any sports fan. Going forward, all of the factors that led to its dismal Q2 were pandemic-centric.

This means that they are largely reversible in time, at least in theory. More shops are opening up, sports games are slowly starting to happen once again, and customers will doubtless begin roaming once more.

And more such value opportunities are likely to be on the way, too. Telus is about to dish the dirt on its own performance during the worst of the quarantine period.

After that, BCE will release its own earnings report. Both of these reports are likely to contain suitably gloomy tidbits sure to trigger share price dips.

In summary, investors looking to begin or build a position in either name should have their pocketbooks at the ready.

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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 Victoria Hetherington has no position in any of the stocks mentioned. The Motley Fool recommends ROGERS COMMUNICATIONS INC. CL B NV.

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