The Motley Fool

Top 3 TSX Stocks Robinhood Investors Are Holding

The Robinhood trading app has been gaining in popularity with young newbie investors south of the border. Although Robinhood isn’t available in Canada, it’s worth checking on the TSX-traded Canadian stocks to see what those youngsters are bullish on.

If you’re a young investor like a millennial, it may make sense to follow in their footsteps into the following three names, as long you’ve got the stomach because the following three names are all pretty risky cannabis stocks that you may have thought young investors have already moved on from.

Without further ado, here are the top three TSX stocks held by Robinhood investors. Spoiler alert: they’re all cannabis stocks!

Aurora Cannabis

The cannabis trade is dead, but Robinhood investors are still hanging on. Today, Aurora Cannabis (TSX:ACB)(NYSE:ACB) shares find themselves down over 90%. Despite the drop, many young investors have been braving the volatility to go against the grain with the licensed producer that could be a major upward mover should euphoria find its way back to pot stocks.

This Tuesday, Aurora stock surged 10.3% in a single trading session alongside the broader basket of pot stocks. The big move may be one of many as the cannabis industry looks to regain its footing in this post-legalization environment that’s faced a drastic expectation reset.

At $15 and change, I’d say Robinhood traders are right to stand by the name at these depths. The company recently expanded into the American CBD market with the acquisition of Reliva. With a mere 0.4 times book multiple, I’d say the stock is a must-buy because all the negatives are already baked in.

Canopy Growth

Canopy Growth (TSX:WEED)(NYSE:CGC) is a pot behemoth that’s held its own far better than Aurora. The stock is sitting down over 60% from all-time highs and trades at 1.7 times book, which is over four times higher than that of Aurora. Canopy’s rolling with the punches better than most other cannabis companies thanks to Constellation Brands standing in its corner.

While I’m a huge fan of Canopy’s brands (such as Tweed and Tokyo Smoke) amid the “cannabis 2.0” catalyst, I can’t say that the premium price tag relative to Aurora is warranted. In any case, Canopy Growth is ridiculously cheap, given the long growth runway that still exists in the budding cannabis market.

Yes, the market may have matured, but value-conscious young investors still have a lot to gain from producers at these depths.

Aphria

Finally, Aphria (TSX:APHA)(NASDAQ:APHA) is the third cannabis play that’s currently down 64% from its all-time high. Shares of the cannabis producer are up over 160% from March lows, having picked up a considerable amount of momentum of late.

Today, the stock trades at 1.12 times book, putting it in between Canopy and Aurora. The main attraction to Aphria is its profitability trajectory and its meaningful international exposure. As the taboo facing cannabis gradually fades and other nations look to follow in Canada’s footsteps with regards to legalization, Aphria could stand to be a significant winner, with front-row seats to promising countries outside the confines of Canada.

Aphria has done a top-notch job of keeping production costs low. And if foreign production gets the green light in other countries, I’d look for costs of production to fall far lower.

Speaking of ample upside, you need to check out these following stocks curated by the team here at the Motley Fool Canada!

Just Released! 5 Stocks Under $49 (FREE REPORT)

Motley Fool Canada's market-beating team has just released a brand-new FREE report revealing 5 "dirt cheap" stocks that you can buy today for under $49 a share.
Our team thinks these 5 stocks are critically undervalued, but more importantly, could potentially make Canadian investors who act quickly a fortune.
Don't miss out! Simply click the link below to grab your free copy and discover all 5 of these stocks now.

Claim your FREE 5-stock report now!

Fool contributor Joey Frenette has no position in any of the stocks mentioned.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss an important event.

Iain Butler and the Stock Advisor Canada team only publish their new “buy alerts” twice a month, and only to an exclusively small group.

This is your chance to get in early on what could prove to be very special investment advice.

Enter your email address below to get started now, and join the other thousands of Canadians who have already signed up for their chance to get the market-beating advice from Stock Advisor Canada.

I consent to receiving information from The Motley Fool via email, direct mail, and occasional special offer phone calls. I understand I can unsubscribe from these updates at any time. Please read the Privacy Statement and Terms of Service for more information.