The S&P/TSX Composite Index plunged 315 points on Wednesday, March 15. Silicon Valley Bank’s failure in the United States has generated considerable anxiety among global investors. That has only worsened with the subsequent failure of Signature Bank and now a crisis at global investment giant Credit Suisse. This kind of volatility could seriously challenge the rate-tightening policies that have been pursued by central banks in the developed world.
Today, I want to do the most to take advantage of this volatility and snatch up some of my favourite stocks at a discount. Let’s jump in.
This dirt-cheap energy and tech stock is worth snatching up in a turbulent market
Pason Systems (TSX: PSI) is a Calgary-based energy services and technology company that provides data management systems for drilling rigs in Canada, the United States, and around the world. The energy sector found itself deep in the red on March 15, as the threat of a recession has reared its ugly face. Shares of Pason Systems have plunged 20% so far in 2023.
This company released its fourth-quarter (Q4) and full-year fiscal 2022 earnings on March 2, 2023. In Q4 2022, total revenue jumped 50% to $94.4 million. Meanwhile, total revenue climbed 62% for the full year to $334 million. EBITDA stands for earnings before interest, taxes, depreciation, and amortization, and it aims to give a clearer picture of a company’s profitability. Pason posted adjusted EBITDA growth of 120% to $159 million in fiscal 2022.
Shares of Pason currently possess a favourable price-to-earnings (P/E) ratio of 9.3. The Relative Strength Index (RSI) is a technical indicator that measures the price momentum of a given security. This stock last had an RSI of 22, putting Pason well in technically oversold territory. It also offers a quarterly dividend of $0.12 per share. That represents a 3.9% yield.
Don’t be afraid to make a meal out of Restaurant Brand’s value right now
Restaurant Brands International (TSX: QSR) is a Toronto-based company that operates as a stable of quick-service restaurants in Canada, the United States, and internationally. Its top three brands are Burger King, Tim Hortons, and Popeyes Louisiana Chicken. Shares of RBI have dropped 3.7% in 2023. However, the stock is still up 16% compared to the prior year. This is a stock that is worth targeting in this volatile climate.
Investors got to see RBI’s final batch of fiscal 2022 earnings on February 14, 2023. RBI achieved system-wide sales growth of 13% for the full year. Meanwhile, adjusted diluted earnings per share (EPS) was reported at $3.14 — up from $2.82 for the full year in fiscal 2021. Moreover, adjusted EBITDA increased 7.5% year over year to $2.37 billion.
RBI stock dipped into technically oversold levels last week. It has since staged a small recovery, but it is not too late to buy the dip. Better yet, RBI also offers a quarterly dividend of $0.55 per share, which represents a 3.3% yield.
Banks look risky, but I’m looking to stack shares of TD Bank amid volatility
The banking sector may be scary to a lot of investors right now, but I’m still bullish on Canada’s profit machines. TD Bank (TSX: TD) is the second largest of the Big Six Canadian banks by market cap and one of the largest retail banks in the United States. Its shares have plunged 9.4% so far in 2023. Volatility or not, I’m bullish on TD Bank for the long term.
In Q1 2022, TD Bank reported adjusted net income of $4.15 billion or $2.23 per diluted share — up from $3.83 billion, or $2.08 per share, in the previous year. TD Bank was bolstered by higher profit margins due to higher interest rates. TD Bank and its Canadian peers have proven resilient in the face of previous financial crises. Indeed, the fiscal conservatism of Canadian banks has made them extremely dependable.
Shares of TD Bank possess an attractive P/E ratio of 9.6. It last had an RSI of 15, putting it deep in technically oversold territory. Moreover, TD Bank offers a quarterly dividend of $0.96 per share, representing a solid 4.8% yield.
