Because of the current market environment, stocks have continued to sell off for weeks now, creating tonnes of opportunities for investors. With so many stocks trading cheap, though, it’s crucial that you look to find value and buy stocks that are the best of the best.
Many stocks are going to look cheap in this environment. So, it’s crucial to ensure that whatever stocks we do buy genuinely offer some of the best value on the market.
That’s why if you’re looking for value stocks to buy now, you may want to consider Corus Entertainment (TSX:CJR.B).
One of the cheapest Canadian value stocks to buy now
The reason I’d recommend Corus as one of the first stocks to consider is that not only is it extremely cheap, but Corus is in a much better position than it’s been in years.
If you’ve followed Corus recently, you’d know it’s a stock that’s been cheap for a while, and lately, it’s gotten ridiculously cheap.
Corus is a media company that owns TV and radio assets. And while there have been fears from investors that the stock may see a slowdown in sales, that’s never quite materialized. In addition, debt has been an issue that investors have had with Corus.
So, for years now, the stock has offered great value. But in the recent selloff, it’s now become so cheap it can’t be ignored and one of the best value stocks that Canadian investors can buy.
In addition, a closer look at the numbers shows that this might be the cheapest Corus has been in years.
How cheap is Corus stock today?
Not only does Corus’s stock price look undervalued, but looking at several metrics, it’s clear the valuation is extremely low, and Corus is one of the best value stocks to buy now.
Corus’s price-to-earnings (P/E) ratio, one of the most basic valuation metrics, is unbelievably low. Today, the media stock trades at a forward P/E of 4.9 times. That’s well below Corus’s five-year average of 6.7 times. In addition, looking at the numbers, it’s clear that since September of 2018, Corus has been priced a lot cheaper by the market.
Since September 2018, Corus’s average P/E has been about six times. However, one of the main reasons Corus has been cheap, as I mentioned before, has been due to its debt load. In recent years, though, its made significant progress in paying down that debt.
That’s why you also want to look at other valuation metrics, such as Corus’s enterprise value (EV), which takes into account its market cap and net debt and shows why it’s one of the best value stocks to buy now.
Because when you look at Corus’s EV-to-EBITDA ratio, a better measure of value than P/E, it’s clear that not only is Corus cheap, but it’s in the best financial position that it’s been in for years.
Since September of 2018, when Corus became noticeably cheaper, the stock has had an average forward EV-to-EBITDA ratio of roughly 5.25 times, which is ultra-cheap. Yet today, Corus trades at a forward EV-to-EBITDA ratio of 4.5 times, which is even cheaper.
Bottom line
There’s no question that Corus offers a tonne of value and is one of the best stocks to buy now. Furthermore, on top of all the value that Corus stock offers, at today’s price, the stock provides an impressive yield of 5.9%.
If you’re looking to put your cash to work this week and take advantage of all the opportunities that this market environment is presenting, Corus is one of the best value stocks to buy now.
