Stocks Under $50: My Top 3 Picks

These under $50 stocks have strong potential for growth and will likely outpace the broader markets.

| More on:
Value for money

Image source: Getty Images

The ongoing economic expansion, recovery in consumer demand, and lower interest rates have made stocks an attractive investment option. Due to upbeat investor sentiments, most Canadian stocks have rallied over the past year and are trading near their 52-week highs. Despite the appreciation in value, shares of a few high-growth Canadian companies are trading under $50, making them well within reach of every investor. 

So if you are looking to invest in high-quality stocks priced under $50, consider buying these three stocks now. 

Well Health

One could consider buying the shares of rapidly growing WELL Health Technologies (TSX:WELL). The telehealth company continues to acquire clinical and digital assets that accelerate its growth and support its financials. Notably, the company has delivered positive adjusted EBITDA in the past three quarters. Furthermore, it remains on track to deliver annualized revenue and adjusted EBITDA run-rate of $400 million and $100 million, respectively. 

WELL Health stock has witnessed a slight pullback this year, which in my opinion, is an opportunity to buy. Its strong and active pipeline of acquisitions, expansion in the U.S., and growing market share in the large digital health sector augur well for growth. Meanwhile, strength in the underlying business, focus on optimization of costs, and expansion of EBITDA support my bullish outlook

Goodfood Market

The digital shift, increased adoption of online grocery services, growing grocery selection, and same-day delivery capabilities make Goodfood Market (TSX:FOOD) a solid investment under $50. Furthermore, its growing basket size, fixed cost leverage, and last-mile delivery optimization augur well for margins, in turn, its stock price. 

Goodfood Market has evolved as Canada’s leading on-demand online grocery service provider. It continues to add new grocery products on its platform and is close to reaching the 1,000 SKU-milestone ahead of expectations. While economic reopening could moderate its growth, I maintain a bullish outlook due to its strong competitive positioning in the growing online grocery market. Further, its growing active subscriber base and focus on reducing delivery time and optimization of cost structure provide a solid base for growth.  

Dye & Durham 

Like WELL Health, Dye & Durham (TSX:DND) is another company in the tech space that’s expanding rapidly. Dye & Durham’s revenues and adjusted EBITDA have grown at a breakneck pace, thanks to accretive acquisitions and strength in the base business. Meanwhile, its focus on revenue diversification, large blue-chip customer base, strong renewal rate, solid balance sheet, and high reoccurring revenues bode well for future growth. 

Thanks to its strong financials, Dye & Durham stock has appreciated quite a lot over the past year. However, it has witnessed a healthy pullback in 2021, providing investors a solid opportunity to go long on its shares. I believe the reopening of courthouses and increased economic activities will keep the demand for Dye & Durham’s products and services elevated. Further, its strong acquisition pipeline, predictable business model, and long-term contracts with top 100 customers will likely support its growth. 

Overall, Dye & Durham’s strong business, solid capital allocation strategy, focus on growing market share, and driving higher revenues from existing customers suggest that the company could continue to grow its revenue and adjusted EBITDA rapidly, which in turn will likely support the rally in its stock.  

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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Goodfood Market Corp.

More on Tech Stocks

Businessman holding AI cloud
Tech Stocks

Could Investing $20,000 in Nvidia Make You a Millionaire?

Nvidia stock has made investors millionaires in the last 10 years. Is it too late to invest to become a…

Read more »

Business man on stock market financial trade indicator background.
Tech Stocks

1 Growth Stock Down 50 Percent to Buy Right Now

There are plenty of growth stocks in the market worth considering, but Shopify (TSX:SHOP) looks like one of the best…

Read more »

Woman has an idea
Tech Stocks

Prediction: 1 Stock That Could Trounce the Market 

The TSX has been favouring tech stocks, but not this one. However, it has the potential to trounce the market…

Read more »

clock time
Tech Stocks

Long-Term Investing: 3 Top Canadian Stocks You Can Buy for Under $20 a Share

These three under-$20 stocks offer excellent buying opportunities for long-term investors.

Read more »

Businessman holding AI cloud
Tech Stocks

AI Will Transform Everything: Investors, Be Early Adopters and Buy These 3 Stocks

Investors looking to invest in companies doing big things in AI should consider these three stocks for their portfolios.

Read more »

stock research, analyze data
Tech Stocks

Forget Shopify: These Unstoppable Stocks Are Better Buys Today 

Should you consider buying Shopify stock while rivals consider a buyout or should you go for stocks with a stronger…

Read more »

A colourful firework display
Tech Stocks

2 Potentially Explosive Stocks to Buy in March

These two growth stocks are destined for many more years of market-crushing returns.

Read more »

edit CRA taxes
Tech Stocks

TFSA Millionaires Are Learning They Can Still Be Taxed

If you day trade stocks like Shopify (TSX:SHOP) in a TFSA, you may be taxed.

Read more »