4 Insanely Cheap Canadian Stocks to Buy for Passive Income

Investors who want passive income in this choppy market should look to Canadian stocks like Freehold Royalties Ltd. (TSX:FRU) and others.

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The S&P/TSX Composite Index fell 72 points on Thursday, March 23. Some of the worst-performing sectors included energy, battery metals, and utilities. Canadian and global markets have been battered due to the ongoing banking turmoil that has led to the collapse of two mid-tier United States banks and the near-demise of Credit Suisse before its rescue by a national rival. Today, I want to zero in on four very cheap Canadian stocks that offer super passive income. Let’s jump in.

This cheap REIT is a passive-income heavy hitter

Artis REIT (TSX:AX.UN) is a Winnipeg-based real estate investment trust (REIT) that invests in industrial and office properties in Canada and the United States. Shares of this Canadian stock have dropped 17% in 2023 at the time of this writing. The stock has plunged 42% in the year-over-year period.

In 2022, this REIT put together a solid year on the back of improved leasing momentum, as it continues to recovery in the aftermath of the COVID-19 pandemic. Occupancy including commitments rose to 92.3% compared to 91.5% on December 31, 2021. The Relative Strength Index (RSI) is a technical indicator that measures the price momentum of a given security. Artis last had an RSI of 18, putting the REIT deep in technically oversold territory. Meanwhile, it offers a monthly distribution of $0.05 per share. That represents a monster 7.9% yield. This should pique the interest of passive-income investors.

Here’s a Canadian stock that is specifically designed to deliver consistent dividends to shareholders

Freehold Royalties (TSX:FRU) is a Calgary-based company that is engaged in acquiring and managing royalty interest in the crude oil, natural gas, natural gas liquids, and potash properties in Western Canada and the United States. This energy stock has dipped 6.3% in 2023. That has pushed its shares into negative territory in the year-over-year period.

This company put together record results in the fourth quarter (Q4) of fiscal 2022. Funds from operations (FFO) jumped 67% to $316 million for the full year. Meanwhile, FFO per basic share increased 51% to $2.10. This Canadian stock currently possesses a favourable price-to-earnings (P/E) ratio of 10. It offers passive income in the form of a monthly dividend payout at $0.09, which represents a very strong 7.6% yield.

Don’t sleep on this super cheap Canadian stock with a great yield

Pembina Pipeline (TSX:PPL) is another Calgary-based company that provides energy infrastructure and midstream services. Its shares have dropped 7.1% in the year-to-date period. The stock is down 11% compared to the same time in 2022.

In Q4 2022, Pembina posted total revenue of $2.69 billion — up from $2.56 billion in the previous year. Meanwhile, cash flow from operations activities per common share rose to $1.72 compared to $1.27 in the Q4 2021. This Canadian stock possesses an attractive P/E ratio of 8.1. It offers a quarterly dividend of $0.652 per share, representing a tasty 6.2% yield.

One more REIT that boasts fantastic value and huge passive income

Northwest Healthcare REIT (TSX:NWH.UN) is the fourth and final passive-income-focused Canadian stock I’d look to snatch up on the dip in late March. This REIT owns and operates a global portfolio of high-quality healthcare real estate. The REIT has dropped 11% so far in 2023.

This REIT is set to unveil its final batch of fiscal 2022 earnings on March 31, 2023. Shares of this Canadian stock possess a very favourable P/E ratio of 6.8. Meanwhile, it last had an RSI of 16, putting Northwest REIT well in oversold levels. The REIT offers a monthly dividend of $0.067 per share, which represents a super 9.5% yield. Northwest is a Canadian stock that offers nice value and fantastic passive income in a choppy market.

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 Ambrose O'Callaghan has no position in any of the stocks mentioned. The Motley Fool recommends Freehold Royalties, NorthWest Healthcare Properties Real Estate Investment Trust, and Pembina Pipeline. The Motley Fool has a disclosure policy.

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