3 TSX Stocks I’m Buying in Bulk During This Downturn

Canadian bank stocks dropped off the face of the earth, so now is the time I would consider buying these TSX stocks for long-term gains.

| More on:
Happy couple being attended by office worker at office

Image source: Getty Images

The market plummeted even more this week thanks to American banks that fell into oblivion. Canadian banks soon followed suit, and it has left many holding up their hands in surrender. Honestly, we beg of the market, no more!

However, it’s time to shift your view during this trying time. Investors who have been doing this a while now should realize that long-term investing can certainly be achieved. Even when you buy during a downturn. In fact, especially if you buy during one if you’re choosing long-term TSX stocks.

And that means choosing the Big Six Banks. Yes, they may indeed be down right now. But these TSX stocks have proven time and again that they won’t remain down forever. Today, I’m going to discuss the three banking stocks I would buy in bulk during this downturn.

TD stock

Toronto Dominion Bank (TSX:TD) is definitely the first of the batch I would consider right now. Shares of TD stock are down 14% in the last year, dropping off by 13% in the last month alone. So why would I recommend buying it? And what happened exactly?

It has to be said that of all the Big Six Banks, TD stock may be the most exposed to the American economy. TD stock is one of the top 10 banks in the United States, after all. However, America also has proven that it can recover quickly during an economic downturn. So, TD stock may rise quickly given this exposure, rather than go bankrupt.

In fact, TD stock has a number of things going for it. They include the numerous loan options on offer, its wealth and commercial management sector, as well as provisions for loan losses, as the other banks have. It’s, therefore, one of the TSX stocks that may offer a huge deal right now, instead of a drop. Especially since you can pick it up trading at 10 times earnings with a 4.48% dividend yield.

CIBC stock

Now TD stock may be the most American exposed of the banking TSX stocks, but Canadian Imperial Bank of Commerce (TSX:CM) is the most Canadian exposed. This is why shares have fallen dramatically in the last few months, far more than those of its other counterparts.

Yet again, CIBC stock is just in a bad situation at a bad time. It has exposure to the declining housing industry, but doesn’t have as much exposure to emerging markets to allow revenue to climb as easily as others. That being said, it still has a lot going for it as well.

In fact, analysts still believe the stock could outperform in the near future. CM stock was helped along during its last earnings report with a “monster performance” from capital markets and improved net interest margins results, according to one analyst. Yet, shares are down 25% in the last year, dropping almost 11% in the last week alone. Yet again, I would consider picking it up while you can, trading at just 11.4 times earnings with a “monster” dividend yield of 5.78%.

BMO stock

Finally, if you’re looking for growth and dividends, with exposure to the American recovery, I would consider Bank of Montreal (TSX:BMO). It’s a balance between CIBC stock and TD stock, and similar to other banking TSX stocks with provisions for loan losses. However, the bank not only has major exposure in Canada, of course, but also growing exposure in the United States.

BMO stock is set to continue growing, adding $2 billion in incremental earnings thanks to the acquisition of Bank of the West. Furthermore, it has also added the Air Miles loyalty program to its arsenal. So, there are certainly many different reasons to consider BMO stock now and in the future.

It also offers value and dividends, trading at just 6 times earnings and with shares down 15.5% in the last year, and 8.5% in the last week alone. And with a 4.82% dividend yield to consider, there are many reasons to buy the stock now.

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 Amy Legate-Wolfe has positions in Canadian Imperial Bank Of Commerce and Toronto-Dominion Bank. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

More on Bank Stocks

data analyze research
Bank Stocks

Better Buy: Royal Bank Stock or Bank of Nova Scotia?

Bank stocks appear cheap after the latest plunge. Is Royal Bank or Bank of Nova Scotia a buy today?

Read more »

Man making notes on graphs and charts
Bank Stocks

TD Bank Stock: A TSX Top Pick Amid U.S. Banking Rout?

TD Bank (TSX:TD) stock could prove a worthy bet for brave investors who aren't fearful over the recent wave of…

Read more »

A stock price graph showing growth over time
Bank Stocks

1 Oversold Dividend Stock (With a 4.7 Percent Yield) I’m Buying Right Now

American bank stocks have hit the market hard, including this stock that's down 22% in a year. Which is exactly…

Read more »

Retirees sip their morning coffee outside.
Bank Stocks

2 Canadian Bank Stocks That Won’t Let You Down

Investors should have no fear holding Canadian bank stocks because the sector is stable, with strict federal policies and protection…

Read more »

Bank sign on traditional europe building facade
Bank Stocks

2 Incredibly Cheap Bank Stocks for Passive Income Following SVB Fallout

Canadian Western Bank (TSX:CWB) is one of many great bank stocks that passive-income investors should watch after SVB's fall.

Read more »

tsx today
Bank Stocks

TSX Today: What to Watch for in Stocks on Friday, March 24

Energy stocks on the TSX may witness a rebound at the open today due to recovering oil prices.

Read more »

A plant grows from coins.
Bank Stocks

How to Invest in the Bank Bailout News

Highly liquid banks like the Toronto-Dominion Bank are the most viable buys in an environment in which banks are collapsing.

Read more »

edit Close-up Of A Piggybank With Eyeglasses And Calculator On Desk
Bank Stocks

RRSP Investors: Save on Taxes and Buy These 2 Cheap Bank Stocks

Are you looking to save taxes via RRSP contributions? Here are two TSX bank stocks you can hold in the…

Read more »