The Best Canadian Stock to Buy This Week

There’s a prime opportunity for Motley Fool investors to pick up the best Canadian stock of this week and perhaps even this year!

Amy Legate-Wolfe

Author Bio

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Her work can also be found at Canada's National Observer, where she writes on the business side of climate action. Before joining Motley Fool Canada, Amy wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband.

Social Media

Follow Amy on LinkedIn and Canada Stock Digest.

Favorite Investment Quote

“October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published August 23, 2021 2:30 pm EDT

Motley Fool investors seem to love reading about lists of great stocks. However, that leaves little opportunity to dig into some of the top companies out there. Today, I’m going to focus on the best Canadian stock that Motley Fool investors should watch this week.

investment research — Image source: Getty Images

What happened?

This week, analysts have been upgrading stocks after earnings reports. Yet today, there was really only one standout that can hold the title of the best Canadian stock to buy this week. And that’s Spin Master (TSX: TOY).

Spin Master stock recently reported another strong earnings performance this month. The company recently saw revenue climb 39% year over year to US$390.8 million for the quarter. Earnings per share doubled what analysts predicted at US$0.40 and was a substantial improvement on the loss of $0.09 EPS the same quarter a year before. Finally, it also improved on a loss the year before to report adjusted EBITDA of US$81.8 million.

A lot of the improvement came from the rise in global shipments, which were up 20%. Because of this, digital games and a new PAW Patrol film, the company raised its revenue guidance.

So what?

Now all of this was then reflected in the company’s share price increasing. And that increase climbed to what analysts predicted — around $50 per share. So, now that the company is at fair value, you might be questioning why it’s still the best Canadian stock to buy this week.

There are a few reasons for this. The company’s financial results proved that a recovery is already underway for Spin Master stock. Motley Fool investors may be paying fair value now rather than premiums later. And there are a few other reasons why this increase should remain quite stable.

Analysts cite an economic recovery, including the child tax credit, kids back in school, parents still working from home, and, of course, holiday promotions with the retail recovery for an increase in industry growth. This also includes the rebound in the film industry in the case of Spin Master stock, with films now back in theatres!

Now what?

For Motley Fool investors looking for a long-term hold on the best Canadian stock, now is the time. You can pick up shares today just below fair value at $49 per share as of writing. The P/E ratio isn’t a deal at 32.75, but it isn’t exorbitant either. Meanwhile, shares are up 70% in the last year and climbing. And analysts predict another 20% could be on the way, despite trading at fair value right now. On top of that, earnings per share are predicted to skyrocket by 193% this year alone!

Spin Master stock has been excellent in finding new opportunities, driving revenue growth in the process. With an economic recovery underway, it hasn’t slacked in acquiring and joining new businesses. The digital gaming industry alone exploded during the last two years. So, investors wanting to buy up a stock and hold on forever would do well to consider Spin Master stock. It could be the best Canadian stock you buy not just this week but this year!