2 Undervalued Canadian Stocks Worth a Buy Right Now

You don’t need to look far to find a discount on the TSX today. Here are two Canadian stocks currently trading at must-buy prices.

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The Canadian stock market got off to a hot start to the year but has since cooled off. The S&P/TSX Composite Index jumped more than 5% in January but is now trading just about flat on the year.

Many individual TSX stocks soared far higher than 5% in January but continue to trade below all-time highs. Investors witnessed plenty of top Canadian stocks drop double-digits in 2022. It will take a few more months like January before we begin to see those beaten-down stocks reach new all-time highs.

In the short term, it may not seem like the most opportunistic time to be investing. Volatility remains high, as both interest rates and inflation are not showing significant signs of declining yet. 

Long-term investors, however, won’t want to miss out on the deals available on the TSX today. There’s no shortage of top companies trading at rare discounts. 

Here are two discounted stocks to add to your watch list if you’re a long-term investor.

TSX stock #1: Brookfield Renewable Partners

Brookfield Renewable Partners (TSX:BEP.UN) has been on a tear in March, with shares up over 10% this month and nearing a 15% return on the year. And that’s not even including the energy stock’s impressive 4% dividend yield, either.

Despite the recent rally, though, shares are still trading 30% below all-time highs set in early 2021. The renewable energy sector as a whole has been on a slide for the past two years. That doesn’t take anything away from the sector’s long-term growth potential, though.

At a market cap of $25 billion, Brookfield Renewable Partners is a global leader in the growing space, loaded with many more years of market-beating growth potential. 

If you’re bullish on the rise of renewable energy, now is the time to be loading up on companies like this one.

TSX stock #2: Shopify

Even after a 70% drop in 2022, Shopify (TSX:SHOP) is by no means a value stock. From a valuation perspective, the tech giant is amongst the most expensive stocks you’ll find on the TSX today. But with shares still down about 70% from all-time highs, there’s certainly a case to be made that this top growth stock is opportunistically undervalued. 

Shares of Shopify are still up a market-crushing 300% over the past five years, even with the dismal performance last year. 

As did many other tech companies in 2022, Shopify dealt with its share of layoffs. Despite that, revenue growth continues to soar, which is why the stock is still richly valued.

It may be a bumpy ride, but this is not a company that is anywhere near done growing yet.

Foolish bottom line

As long as you’re willing to be patient, there’s no need to let the short-term noise in the stock market keep you on the sidelines. Great companies will survive these volatile market conditions and will soon return to their market-beating ways.

If you’ve got some cash to spare, Brookfield Renewable Partners and Shopify are two companies that should be high up on your watch list. These discounted prices won’t be around forever.

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 and Shopify. The Motley Fool has positions in and recommends Shopify. The Motley Fool recommends Brookfield Renewable Partners. The Motley Fool has a disclosure policy.

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