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Buy Alert: This Canadian Growth Stock Can’t Get Any Cheaper!

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Over the past few weeks, there has been a lot of movement in Canadian stocks. Renewable energy stocks, for example, have been selling off slightly. This was due to some lofty valuations at the same time that traditional energy stocks have been rallying.

The dip in renewable energy stocks creates a big buying opportunity. It’s one of the best long-term industries you can invest in. And while traditional renewable energy stocks like power generators are great choices, some of the best stocks are in clean technology.

That’s why the massive drop by Xebec Adsorption (TSX:XBC) in the last month is one of the best opportunities for investors today.

Xebec: A top Canadian growth stock

As I mentioned before, the entire renewable energy industry had been pulling back from the extraordinary highs they hit over the last year.

So, last week, when Xebec warned about lower guidance for its upcoming earnings report, the Canadian stock suffered a major selloff as a result.

As is usual with these massive price shifts, though, the market is severely overreacting. A downgrade in guidance is never ideal, but Xebec is now down more than 60% from where it was just a few months ago.

So, this makes it the perfect buying opportunity for long-term investors. Xebec offers significant potential, but it’s major potential over the long run. Long-term investors will surely use this opportunity to buy the stock at a major bargain.

One of the most pressing issues that the world needs to solve these days is the climate change crisis. Global warming is clearly changing weather patterns and impacting the climate. And if the world doesn’t do something to stop those changes fast enough, the impact won’t be reversible.

Governments around the world continue to recognize this and have been working together to cut emissions and focus on cleaner, more efficient ways to operate.

That’s where the renewable energy industry comes in. To save the world from itself, there will need to be a lot more technological innovation, especially from Canadian green energy stocks. Already green technology has improved considerably to be able to even be cost competitive with fossil fuels.

However, more work needs to be done so that companies in all industries can reduce their emissions, and that’s where an industrial cleantech equipment maker like Xebec comes in.

Xebec’s operations and potential

There are two main segments of companies — hydrogen stocks and renewable natural gas companies — in the cleantech space. Both types of businesses offer their own unique advantages, and both will play a key role in the future.

Xebec is attractive, because it’s one of the leading North American cleantech stocks in both segments. The company builds equipment that helps trap naturally occurring raw gases and transforms them into renewable natural gas or hydrogen.

This is a key business that can help play a major role in reducing climate change. That’s why the Canadian growth stock has so much potential.

Plus, Xebec has made a string of attractive acquisitions lately. This helps to build both its customer base as well as its expertise and technology. That’s why this recent pullback in the stock price is such a great opportunity for investors.

Bottom line

Xebec is one of the top long-term growth stocks you can buy today. Any renewable energy business offers potential. But cleantech stocks are some of the best growth businesses to own. So, at this major discount, it might be the last time you get the Canadian stock for this cheap.

You may see it get slightly cheaper in the next few days. But given it’s so undervalued, the stock can’t fall much further. So, if you’re looking for an ideal stock that can grow rapidly, Xebec has a tonne of potential and is worth just $600 million.


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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 Daniel Da Costa owns shares of Xebec Adsorption Inc.

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