2 Cheap Canadian Stocks to Buy Today

If you’re a value investor looking for cheap stocks to buy today, these two Canadian companies offer some of the best potential for growth.

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There aren’t too many Canadian stocks trading cheap in the current investing environment that are worth a buy today.

It’s not just about finding stocks that are trading at less value than they used to be. Often beginner investors will see charts of poorly performing stocks and look to buy the dip.

That can certainly work sometimes, as evidenced by most stocks recovering after the total market selloff last February and March. However, if that business can’t ever recover, that will never be a good investment.

So although we want to buy stocks cheaply, it’s important to make sure they are actually trading undervalue.

We always want to ensure we’re buying the highest-quality stocks possible. So with that in mind, here are two of the cheapest Canadian stocks to buy today.

A cheap Canadian gold stock

Many sectors have done well over the past year. One of the worst-performing industries is gold.

Gold was hot last year during the panic. This is usually the case as investors search for a safe haven. However, as the market has recovered and rallied, investors have sold their gold holdings to participate in the rally.

This caused gold to fall out of favour. So why are gold stocks a buy today? Gold is a buy because it’s been oversold. It’s now cheap, and it’s a great asset to buy and hold in your portfolio for the long term.

So if you don’t have any gold exposure, it might be a good idea to consider some Canadian gold stocks while they’re still cheap.

Plus, if you buy a high-quality gold stock, such as Equinox Gold (TSX:EQX), not only will you gain exposure to gold, but you’ll also have exposure to top-notch operations which are growing rapidly each year.

This is a big benefit and explains why these stocks are ideal long-term investments. The price of gold may not always be climbing, but if Equinox can grow its production and lower its costs, it can earn investors more money and grow shareholder value.

The price of gold increasing over the long term is just a bonus. So although there are plenty of high-quality Canadian stocks to buy now in the gold industry, Equinox is one of the top stocks to buy today because of its growth strategy.

The company only commenced operations in 2018 and is already targeting 1 million ounces in annual production by 2023.

Equinox’s growth potential means that it’s extremely undervalued today, and analysts agree. It has one of the biggest discounts to its consensus analyst target price in the entire gold sector.

Not only do five of the six analysts who cover it have a buy, with the other analyst rating the stock a hold. But the $16.50 average target price means, according to analysts, the stock is worth more than 50% of what it’s trading at now.

So if you’re looking for a cheap Canadian stock to buy today, Equinox is a great choice.

A leading energy stock to buy today

Another sector where you can still find high-quality stocks trading undervalue is energy. Energy was one of the hardest-hit industries from the pandemic, and even today is still impacted by fears of more waves of the virus.

When everyone is staying at home and businesses are shut down, the demand for energy drops significantly.

Now that energy demand is generally recovering, though, so too are commodities prices. That’s why energy stocks like Suncor Energy (TSX:SU)(NYSE:SU) are some of the cheapest stocks to buy today.

Several energy stocks offer compelling value today, but Suncor is one of the best, especially considering that the company is massive and has vertically integrated operations, making it one of the most resilient stocks in the industry.

These top-notch operations are what make it such a great long-term investment. So the fact that you can still get it at a discount makes it one of the top stocks to buy today.

The stock has already rallied by 33% year to date and 50% over the last six months. Today, with an average analyst target price of $34.50, that’s still a roughly 20% premium from Monday’s closing price.

I wouldn’t wait long to pull the trigger, though, as the Canadian stock doesn’t look like it will be cheap for much longer.

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 has no position in any stocks mentioned.  

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