The TSX has fallen over 6.4% since the beginning of this month, and it still hasn’t hit a recovery trajectory. But it’s also not falling at a steep angle anymore. We can’t say for sure whether the market is moving towards stability or an outright bullish phase, but, eventually, it will bounce back.
And even a steady market recovery might be a strong growth trigger for certain stocks, three of which should be on your radar right now.
A mental health and well-being company
LifeWorks (TSX:LWRK), which used to be Morneau Shepell up until a few years ago, is a mental health and well-being company that has worked with over 15,000 organizations around the world and its clients, include impressive names like Lenovo and the Home Depot. Over 36 million individuals working for about 25,000 organizations around the globe are under the purview of services LifeWorks provide.
And even though it has an impressive international reach (roughly 160 countries), the bulk of the revenue still comes from Canada and the U.S.
Calling the LifeWorks stock “battered” at this time might be an understatement. It’s not just trading at a 51% discount from its former peak; it’s also trading at the lowest level since 2016. Before the current fall, it was an impressive liner growth stock that can offer reliable/predictable growth in the future as well.
The real estate sector is quite beaten down right now, but First Capital REIT (TSX:FCR.UN) stands out even among most other REITs in the country. And it’s not just because of its current 25% discount. Even at its height of recovery, the REIT was not even close to reaching its pre-pandemic levels. Unfortunately, even with that high a slump, the REIT’s dividend yield is modest at best (3%).
Its dividends are a weak point for the investment, even if you disregard the yield since it has slashed its payouts quite brutally since 2019.
However, with an organic recovery of the real estate sector, the REIT is expected to bounce back, and if that happens after a significant extension of the current fall, the recovery to the pre-pandemic price might offer quite decent returns.
A safety solutions company
Blackline Safety (TSX:BLN) offers a wide range of safety solutions for multiple industries, though the bulk of its solutions are designed for oil and gas, hazmat and fire response, and water and wastewater treatment. Personal gas detection and lone worker safety are the company’s forte. The company has recently unveiled a large-scale “trade-in” program for emergency responders, which allows them to exchange older equipment for new, top-of-the-line equipment.
It sends a strong message regarding the company’s commitment to the community, and it might earn it more than just ESG points. The stock, which grew over 650% between Jan. 2014 and July 2021, is currently trading at a 60% discount from its peak. And considering the angle of the stock’s decline, it seems like the stock might continue downward for a bit more before reverting course.
If the current market correction turns into an outright market crash, which is highly unlikely, the three stocks might see a harder decline before bouncing back. The fall, especially if it’s followed by a recovery that helps the stocks reach their former peaks, will benefit the investors.