The Canadian stock market got off to a hot start to 2023 with the S&P/TSX Composite Index up more than 5% year to date already. Still, the index is down close to 10% from 52-week highs that were set in early 2022.
With the market as a whole still in recovery mode, there are plenty of high-quality stocks on the TSX trading at bargain prices.
I’ve put together a list of three discounted stocks that I’ve got at the top of my watch list right now.
If you’ve got some cash to spare, I’d strongly suggest having a closer look at all three companies. With the market’s strong start to the year, these cheap prices might not be around for much longer.
goeasy
goeasy (TSX:GSY) is already nearing a 20% gain on the year. The growth stock is still trading more than 40% below all-time highs, but I don’t think it will be long before the company is back to delivering market-beating returns.
Even with the recent selloff, shares are still up a market-crushing 200% over the past five years. Not many other TSX stocks have put up growth numbers like that since 2018.
The $2 billion company is a consumer-facing financial services provider. Unsurprisingly, high interest rates have slowed down demand for goeasy’s services.
With interest rates as high as they are today, now’s the time to be loading up on this market-beating growth stock. It may be a long time before goeasy is trading at a discount like this again.
Brookfield Renewable Partners
I added to my Brookfield Renewable Partners (TSX:BEP.UN) position several times in 2022 and may be doing the same this year, especially at these discounted prices.
Most renewable energy stocks on the TSX have not fared particularly well over the past two years, and Brookfield Renewable Partners is no exception.
Shares have dropped nearly 40% since the beginning of 2021. Still, the energy stock has managed to more than double the returns of the Canadian stock market over the past five years. And that’s not including the company’s impressive 5% dividend yield, either.
The company is a global leader in the growing renewable energy space, offering its customers a wide-ranging portfolio of services to choose from.
If you were to own just one renewable energy stock in your portfolio, there’s no doubt that Brookfield Renewable Partners would be my recommendation.
Air Canada
Last on my list is the beaten-down airline stock, Air Canada (TSX:AC). Canada’s largest airline continues to trade far below pre-pandemic levels, although the stock is up more than 50% from its 2020 lows.
Air Canada is one of the few North American airlines that has a history of outperforming the market. The airline industry isn’t typically known for driving market-beating returns, but Air Canada was doing just that in the years prior to 2020.
With the demand for international travel well on the way to returning to pre-pandemic levels, now could be an incredibly opportunistic time to start a position in this cheap airline stock. Air Canada has proven it can be a consistent market beater, and I believe it’s only a matter of time before it’s back to its old ways.
