Anyone that’s been investing in Canadian stocks has not had much to complain about as of late. The S&P/TSX Composite Index is up about 20% year to date and nearing an incredible 80% gain since late March 2020.
The current bull run has been fueled by several different sectors in the Canadian market over the past year and a half. High-growth tech stocks kicked off the bull run with an impressive rebound from the COVID-19 market crash early last year. In 2021, we’ve witnessed a shift away from high-priced growth stocks into more value-oriented investing.
The shift towards value stocks this year has presented long-term investors with no shortage of excellent buying opportunities. Even though the market is trading at all-time highs, there are plenty of top Canadian stocks trading at discounts.
I’ve put together a list of three picks that are all trading below all-time highs. Not only that, but Canadian investors can own the entire basket of three companies for less than $100 right now. I’d act fast, as I don’t think it will be long until the three stocks are back to all-time highs.
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A Canadian stock that does it all
Utility companies tend to be used more as defensive stocks in investment portfolios. The dependable nature of the utility business can often lead to lower volatility, especially during market downturns.
There are more reasons than just defensiveness to have Algonquin Power (TSX: AQN)(NYSE: AQN) on your watch list, though.
The steady dividend-paying Canadian stock is no stranger to outperforming the market. Shares are up a market-beating 60% over the past few years. And that’s not even including its impressive 4.5% dividend yield.
A key reason for the company’s growth has been its exposure to the growing renewable energy sector. And with customers spread across North America, I don’t see the market-beating growth ending anytime soon.
Two tech stocks trading at opportunistic discounts
Many tech leaders have trailed the market’s strong performance this year. The tech sector led the way for growth investors last year, but it’s been a much more volatile year in 2021.
I’ve got Dye & Durham (TSX: DND) and Absolute Software (TSX: ABST)(NASDAQ: ABST) on my watch list this month. The two Canadian stocks are trading at discounts right now, but I don’t think that will last for long.
Dye & Durham only joined the TSX in July 2020. Since then, shares are already up 150%. The tech stock isn’t a cheap investment by any means, but high-growth picks rarely are.
Down close to 30% from all-time highs, now could be a wise entry position into this high-growth Canadian stock.
Absolute Software is another tech stock trading well below all-time highs. Even with a 30% drop over the past nine months, though, shares are still up well over 100% over the past five years. That’s good enough for an easily doubling the returns of the Canadian market.
If Dye & Durham is too richly valued for you, Absolute Software may be a better fit. It’s not cheap, but considering the current discounted price, and the stock’s track record of outperforming the market, I’d say it’s well worth the price it’s trading at today.
