As the fall approaches, investors may be looking to add some defensiveness to their portfolios. Indeed, as the market melts up today, investors may not necessarily feel that adding value stocks makes sense. However, in this type of hyper-growth market, hedging one’s bets is never a bad idea.
Here are three top value stocks I’d invite investors to consider right now.
Top value stocks to buy: Manulife
One of the top value stocks on my list for some time, Manulife (TSX:MFC)(NYSE:MFC) continues to provide a compelling value thesis. Indeed, this insurance company’s valuation of around seven times earnings is dirt cheap. Compared to nearly any financials stock, Manulife comes in near the bottom of the pack in terms of its valuation (or top of the pack, depending on how you look at it).
Manulife is an insurance company with excellent growth prospects, particularly in Asia. The company’s booming overseas wealth management and insurance business is only expected to get larger. Accordingly, I view this large-cap stock as a safe, defensive value play right now.
Another one of the top value stocks I’ve been pounding the table on of late is Alimentation Couche-Tard (TSX:ATD.B). This purveyor of gas stations and convenience stores has been hit hard as a result of the pandemic. However, those looking for a company with a strong recovery thesis will like this play.
The company’s outlook over the next five years is impressive. Couche-Tard expects to double its earnings per share over this time frame, as the company pursues organic and M&A-driven growth.
I think this is a company long-term investors would be remiss to ignore right now.
Like Manulife and Couche-Tard, Scotiabank also boasts strong international growth potential. This Canadian bank has a growing presence in Latin America — a region I see as high-growth (albeit with higher risk).
The company’s earnings have ballooned over the past year, nearly doubling from pandemic levels last year. That’s impressive. And I think more of the same is likely on the horizon.