2 Cheap Canadian Stocks That Likely Won’t Be on Sale For Much Longer

These two Canadian stocks are close to returning to all-time highs. Don’t miss your chance to take advantage of these rare buying opportunities.

| More on:
A stock price graph showing declines

Image source: Getty Images.

Canadian investors have had no shortage of buying opportunities through the first seven months of the year. The S&P/TSX Composite Index is down more than 5% year to date with plenty of high-quality stocks trading at losses far more than that. But over the past month, we’ve witnessed some momentum gather in the stock market.

Despite continued fears of a recession, the forward-looking stock market is finally showing signs of bullishness. Perhaps all the pessimism surrounding rising interest rates, inflation, and a recession have already been priced in.

As a long-term investor, I’ve continued to add to my positions throughout the year. But with the market now showing signs of life, some of the discounts that I’ve been taking advantage of this year might not be around for much longer.

I’ve discovered two top Canadian stocks that are close to returning to all-time highs. Both stocks are up about 10% over the past month, well on their way to setting new 52-week highs.

If you’ve got some cash to spare, these two companies should be at the top of your watch list.

Canadian stock #1: Brookfield Renewable Partners

Renewable energy stocks across the TSX have been on fire over the past two months. However, prior to this recent surge, many of those companies had been trending mostly downwards since early 2021.

Renewable energy is one area of the market that I’m extremely bullish on. I’d encourage any long-term investor to think about gaining exposure to this growing industry.

At a market cap of over $30 billion, Brookfield Renewable Partners (TSX:BEP.UN)(NYSE:BEP) is not only a Canadian but a global leader in the renewable energy space. The subsidiary of Brookfield Asset Management offers its global customers a wide range of different green energy solutions.

The stock is up a market-crushing 15% year to date. Going back five years, shares are up more than 125%. In comparison, the broader Canadian stock market has returned only 30% in the same time span. And all that growth from Brookfield Renewable Partners isn’t including dividends, either.

At today’s stock price, the company’s dividend is yielding above 3% annually. Not bad for a stock that’s more than doubled in price over the past five years.

Shares are still down about 15% from all-time highs set in 2021. But at the rate the stock has performed lately, it might not be trading at a discount for much longer.

Canadian stock #2: Constellation Software

There aren’t many Canadian stocks that have outperformed the growth of Constellation Software (TSX:CSU) since it went public 15 years ago. The under-the-radar tech company has been quietly delivering consistent market-beating returns to its shareholders since the it joined the TSX.

Growth has slowed in recent years but the tech stock is not yet anywhere near underperforming the market’s returns. Shares are up a market-crushing 200% over the past five years.

The stock is currently trading close to 10% below 52-week highs. It’s not a huge discount but this is not a stock that goes on sale like this very often.

If you’re looking to add a dependable growth stock to your portfolio, Constellation Software is an excellent choice, especially at this price.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Nicholas Dobroruka has positions in Brookfield Renewable Partners. The Motley Fool recommends Brookfield Asset Management Inc. CL.A LV and Constellation Software.

More on Energy Stocks

Money growing in soil , Business success concept.
Energy Stocks

If You Like Cenovus Energy, Then You’ll Love These High-Yield Oil Stocks

While Cenovus Energy is a quality oil stock, its dividend yield doesn't compare to the yields of Suncor or Canadian…

Read more »

Man considering whether to sell or buy
Energy Stocks

So You Own Algonquin Stock: Is It Still a Good Investment? 

Investors who purchased Algonquin stock in 2022 are 40% in the red as the company underwent restructuring. Is it still…

Read more »

Oil pumps against sunset
Energy Stocks

How to Build a Bulletproof Monthly Passive Income Portfolio With $25,000 and WCP Stock

If you want monthly passive income, consider this stock. Here’s how to achieve all that income in the first place.…

Read more »

Clean energy
Energy Stocks

Why Cameco Stock Rose 2.95% on Tuesday

Cameco stock has stalled recently, but things might be turning around again as increased nuclear spending in the U.S. takes…

Read more »

grow dividends
Energy Stocks

If I Were You, I’d Buy These 2 Stocks Before They Skyrocket

Two stocks are poised to skyrocket in the impending comeback and bull run of the energy sector in 2024.

Read more »

oil tank at night
Energy Stocks

Why Northland Power Is a Top Energy Stock That’s Not Getting the Love it Deserves

Many investors may be wondering why Northland Power (TSX:NPI) is down so much, and here are a few reasons to…

Read more »

oil tank at night
Energy Stocks

2 Energy Stocks to Buy Hand Over Fist in March

These two rallying Canadian energy stocks can continue their bullish runs in 2024 and beyond.

Read more »

Solar panels and windmills
Energy Stocks

Dividend Investors: Top Canadian Energy Stocks for March 2024

Investors could consider top energy stocks like Enbridge for reliable dividend income.

Read more »