The stock market selloff intensified last month, as concerns about an upcoming recession amid rising interest rates and inflationary pressures started haunting investors. While the market correction looks horrifying at first, it could be seen as an opportunity for long-term investors to buy quality stocks at a discount.
In this article, I’ll highlight two of the best under-$5 cheap stocks you can consider buying today and holding for the long term. Let’s begin.
Corus Entertainment stock
Corus Entertainment (TSX: CJR.B) is a media and broadcasting company with a market cap of about $707 million. In June, the market selloff drove its stock down by 21%. As a result, it now trades at $3.58 per share after losing nearly 25% of its value in 2022 so far.
In the May quarter, the Canadian broadcasting company registered a 7.6% YoY (year-over-year) increase in its total revenue to $433.5 million with the help of the solid performance of its television and radio segments. Corus Studios recently announced its biggest U.S. output multi-year deal with the American streaming giant Hulu for more than 400 episodes of lifestyle, renovation, unscripted, and crime content. I expect its top-line growth to accelerate further in the coming quarters, as Corus continues to focus on advancing its strategic priorities by expanding its digital and traditional media advertising offerings.
Given these positive factors, Corus stock looks really cheap after its recent dip. It could also be a great under-$5 stock for income investors’ portfolios, as it currently offers an attractive dividend yield of around 6.7%.
Capstone Copper stock
Capstone Copper (TSX: CS) is my second stock pick for investors who want to buy some cheap under-$5 stocks in Canada after the recent market selloff. The shares of this Vancouver-based copper mining firm have lost nearly 40% value erosion in the last month and currently trade at $2.60 per share with 53% year-to-date losses. Last year, roughly 70% of Capstone Copper’s total revenue came from its Pinto Valley mine, while its Cozamin mine accounted for the remaining nearly 30%. Capstone Copper is currently focusing on ramping up its new Mantos Blancos mill and constructing the Mantoverde sulphides project, which should help it accelerate its financial growth in the coming years.
Inflationary pressures have badly affected the entire metals and mining industry lately. Its massive stock losses in the last month could be attributed to a sharp decline in copper prices amid rising concerns about a recession and growing inflationary pressures. Despite these near-term worries, the outlook for copper prices remains strong, as the base metal is heavily used in several sectors, including technology, renewable energy, infrastructure, and transportation.
Overall, the financial growth outlook for Capstone Copper looks solid. Street analysts expect the company to register more than a 90% YoY jump in its total revenue for the full year 2022. Moreover, the Canadian miner’s well-diversified portfolio of high-quality, long-term operating assets makes this one of the safest stocks to own for the next decade that trades under $5 a share right now.
