Got $3,000? Buy These TSX Stocks in Your TFSA

Are you looking to invest in stocks that fell due to short-term issues but whose long-term growth remains intact? Here are three such stocks.

| More on:
investment research

Image source: Getty Images

These are difficult times as liquidity and affordability are drying up. Addressing the high inflation, the Canada Revenue Agency has increased the 2023 Tax-Free Savings Account (TFSA) limit to $6,500. But don’t use up all your limits, as the coming bear market will present more value opportunities in mid-2023. But right now, three TSX stocks can grow your $3,000 significantly when the economy recovers later this year. 

Three TSX stocks to buy with $3,000 

As Warren Buffett says, “be fearful when others are greedy and greedy when others are fearful.” The 2022 tech selloff and the 2023 market dip from the U.S. banking crisis have made investors fearful of high-risk technology stocks. The rising inflation interest rate is reducing the purchasing power of consumers, making investors fear auto-related stocks.

It is time to go contrarian on these stocks, as they have a strong recovery rally. Here are three stocks to buy with $3,000 TFSA money. 


BlackBerry (TSX:BB) stock lost 63% value in the 2022 tech stock selloff. This selloff was also because of the company’s weak earnings. Its cybersecurity revenue has been declining throughout 2022, as governments delayed the signing of contracts. And the automotive revenue was stagnant, as delays in car production due to supply chain shortages pushed BlackBerry’s QNX royalty revenue. However, the company kept the design win momentum going, helping it secure revenue for its product designs. 

BlackBerry has three growth triggers — one which materialized on March 20. The company sold its non-core patents to Malikie Innovations for $900 million ($200 million in cash and $700 million in royalties on profits). The other two triggers are the recovery in automotive production that could unlock $560 million of unrealized royalty revenue and the signing of pending cybersecurity deals. 

A looming recession in mid-2023 could keep revenues and earnings low in the short term. But BlackBerry’s $500 million cash reserve and no debt give it the financial flexibility to fund its losses and research and development. The stock is a buy while it still trades below $6, as it could return to its $8 average trading price, as the other two triggers unlock. 

Magna stock 

Magna International (TSX:MG) stock fell almost 20% after the company reported slightly weak 2022 earnings but gave strong guidance of a 6.8% average revenue-growth rate in the next three years. The auto component supplier is hit by the many challenges of electric vehicle (EV) adoption.

First, the pandemic, then the semiconductor shortage, then the energy crisis, and when these supply issues were resolved, the inflation and high-interest rate pushed EV demand to a future date. In China, EV adoption was the fastest and EV maker BYD reported a 400% jump in net income on record EV sales. 

China’s growth could be replicated in all major auto markets where Magna has a presence. Warren Buffett purchased BYD shares when it was not trending. You can buy Magna shares now and sell them when the stock crosses its 2021 peak of over $110. It surged at this level as demand recovered and before the supply shortages began. Magna expects to see growth in the second half of the year, as the economy recovers. 

Don’t wait for the second half of the year to buy the stock. Buy now when everyone is selling. You could pocket a 40-50% profit when EV momentum revives. 

Dye and Durham 

Dye and Durham (TSX:DND) is another tech stock that could unlock value once it sells its TM Group U.K. to comply with the competition regulator. The work efficiency software grows through acquisition. It has had several successful acquisitions in its lifetime. But as the size of acquisitions increased, so did the complications. 

DND’s long-pending acquisition of Australia’s Link Group was pulling down the former’s stock price as delays added to the cost. DND stock jumped 55% after it terminated this problematic acquisition in December 2022. The TM Group U.K. acquisition has become problematic. It is dragging DND’s stock price. Once DND sells TM Group U.K., it will release funds for further accretive acquisitions. 

Investing tip 

Don’t buy stocks when everything is rosy. Instead, buy them when dark clouds stall growth for the short term.

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 Puja Tayal has no position in any of the stocks mentioned. The Motley Fool recommends Magna International. The Motley Fool has a disclosure policy.

More on Investing

Hand arranging wood block stacking as step stair with arrow up.
Dividend Stocks

1 Growth Stock With Legit Potential to Outperform the Market

Identifying the stocks that have outperformed the market (in the past) is relatively easy, but selecting the ones that will…

Read more »

healthcare pharma
Tech Stocks

Well Health Stock Is Up 7% After Earnings: What Investors Need to Know

Well Health is benefiting from strong demand as it digitizes healthcare and strives to improve patient outcomes.

Read more »

money cash dividends
Dividend Stocks

Passive Income: The Investment Needed to Yield $1,000 Per Annum

Do you want to generate a juicy passive-income stream? Here's a trio of stocks that can generate a yield of…

Read more »

Dividend Stocks

Here’s the Average TFSA Balance in 2024

The average TFSA balance has steadily risen over the last six years and surpassed $41,510 in 2023. Will the TFSA…

Read more »

Shopping card with boxes labelled REITs, ETFs, Bonds, Stocks
Dividend Stocks

Invest $10,000 in This Dividend Stock for $1,500.50 in Passive Income

If you have $10,000 to invest, then you likely want a core asset you can set and forget. Which is…

Read more »

Supermarket aisle with empty green shopping cart
Stocks for Beginners

Is Dollarama Stock a Buy?

Dollarama stock (TSX:DOL) has seen shares surge on the back of strong performance and a dividend boost, but it also…

Read more »

potted green plant grows up in arrow shape
Dividend Stocks

TFSA Set and Forget: 2 Dividend-Growth Superstars for the Long Run

I'd look to buy and forget CN Rail (TSX:CNR) and another Canadian dividend-growth sensation for decades at a time.

Read more »

Payday ringed on a calendar
Dividend Stocks

1 Passive-Income Stream and 1 Dividend Stock for $781.48 in Monthly Cash

Looking for passive income? Don't take out a loan with that high interest involved. Instead, consider this method for years…

Read more »