This Oversold Stock Is Still up 783% Over the Past 10 Years

This oversold stock is up 783% in the last decade for reasons outside its control, making it a great time to pick it up.

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There are quite a few oversold stocks on the market right now, yet that includes some that don’t deserve to be there. One of those companies includes oversold stock goeasy (TSX:GSY).

While shares of goeasy stock are down 25% in the last year, over the last decade alone, those shares are up 783% and even more over the last few decades. So, let’s see whether now is actually a great time to pick up this oversold stock.

What happened?

The problem for goeasy stock, as with many right now, comes from outside influence — specifically, the Canadian government. During the announcement of its federal budget, the federal government announced it would lower the criminal rate of interest to 35% from 47%.

The move certainly affected goeasy stock, which currently has about 35% of its portfolio wrapped up in interest rates that are above that 35% interest rate. Of course, the criminal rate doesn’t come into affect immediately, but even so. goeasy stock is going to have a hard time suddenly changing a huge chunk of its portfolio to fall in line pretty much immediately.

goeasy stock was already down far below fair value and current price targets. With that in mind, analysts continued to recommend the oversold stock, with an outperformer rating pretty much across the board.

Let’s look at why.

Still a strong buy

Sure, this new government move isn’t going to be great for goeasy stock. But the company, which has been around since the 1990s, has seen hard times before. What’s more, it continues to post record-setting earnings reports quarter after quarter.

In fact, earnings are now just around the corner for goeasy stock; they’re due out May 9. Analysts continue to weigh in ahead of earnings, and the recommendation remains a “buy” rating. While the price target has been lowered in that time, there is certainly still a lot of room to grow.

Analysts now expect the first quarter to fall within the guidance range. Of course, that’s not going to be the main focus. What will be interesting is how the company will adjust to this new 35% limit and provide for a new growth outlook.

However, analysts that have already weighed in are confident the company can manage the situation well. goeasy stock holds a strong management team with solid loan origination growth. It continues to see growth in its insurance and credit underwriting and generate incredible returns on earnings.

Bottom line

goeasy stock currently trades down far below fair value, which is why investors should certainly consider it today. It trades at just 10.6 times earnings, with a dividend yield at 4.2% as of writing. Should it reach the consensus price target on the TSX today, that could offer investors a potential upside of 81% as of writing. So, goeasy stock, though one of the oversold stocks, should certainly remain on the radar of investors hoping for more triple-digit growth in the next decade — if not far beyond.

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 Goeasy. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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