The TSX continues to climb past record highs this month, passing the 20,000-point mark and not looking back. As the economy continues to recover during the pandemic for a post-pandemic world, there are a few industries that investors should consider. There are still many undervalued stocks that may be at all-time highs but are still deals. Today, I’m looking at three dirt-cheap undervalued stocks that are screaming buys.
Food for thought
Nutrien (TSX:NTR)(NYSE:NTR) is a $42.64 billion company that provides crop nutrients and solutions across the world. Shares of the company are up 70.5% in the last year alone but have taken on a pullback during the last month of about 7%. That creates a prime opportunity for investors to jump on this stable yet undervalued stock.
The company has seen massive growth through acquiring other crop nutrient manufacturers around the world. But it hasn’t stopped there. It’s recently increased its potash guidance due to global demand. This is especially true of its deals in India and China, where nutrients are sorely needed.
Even with shares climbing to all-time highs, this is a stock that long-term investors will consider cheap given its future outlook. Meanwhile, you can also pick up a dividend yield of 2.97% as of writing.
An undervalued stock in a booming industry
The healthcare sector continues to be one of the top sectors to look for undervalued stocks. During the pandemic, non-essential services came to a standstill. Now, there is a backlog that has to be picked up at full speed. That’s why companies like Aurinia Pharmaceuticals (TSX:AUP)(NASDAQ:AUPH) are bound to see stellar growth.
Shares in Aurinia are still down by 21.5% in the last year but have climbed 40% in the last month alone as of writing. Shares crashed because of its earnings, but forward-looking investors should be excited. The company’s Lupkynis drug recently received FDA approval. This marks the first approved oral drug to treat lupus nephritis and is likely to see massive revenue for the company.
The stock is now in value territory because of all this, creating an opportunity for those seeking undervalued stocks. In fact, analysts believe the stock could reach about $36.50 in the next year alone. That’s a potential upside of 117% as of writing!
Go gold: Yes, even now
Gold is seeing a setback as the economy recovers. And it makes sense. When the economy drops, gold prices increase, as investors seek leverage. However, when the economy recovers, there is usually a drop in gold prices. The spot price of gold continues to be hit hard, even in the face of rising inflation. However, that creates an opportunity for investors to seek out and buy up undervalued stocks in the gold industry. This includes Kirkland Lake (TSX:KL)(NYSE:KL).
Kirkland shares are down 10% in the last year, with the economy creating the push downwards. Add to that the pandemic, which saw production come to a halt. However, production is now back online, and the company is now a global operation. It continues to acquire business after business, creating a diverse, global portfolio for investors to see revenue increase again and again.
The company has a relative strength index of just 34 right now — almost at oversold territory. It also has a price-to-earnings ratio of 14.2, making it a value stock. Finally, analysts believe shares could reach $80 in the next year alone. That would create a potential upside of 70% as of writing!
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 Amy Legate-Wolfe does not have a stake in any of the stocks mentioned. The Motley Fool recommends Nutrien Ltd.