Buying stocks when their prices are low can be a smart move, especially for long-term investors looking to multiply their hard-earned savings over time. As macroeconomic uncertainties have kept the stock market highly volatile of late, this market volatility has also made some fundamentally strong Canadian stocks look cheap. By adding these quality stocks to your portfolio now, you can not only leverage the ongoing market downturn to your advantage but also increase your chances of getting significant returns on investments in the long run.
In this article, I’ll highlight two of the best Canadian stocks you can buy today to expect big profits if you hold them for at least the next five years.
Celestica (TSX:CLS) is the first Canadian stock you can consider buying right now. If you don’t know it already, it’s a Toronto-headquartered company with expertise in making hardware platforms and other supply chain solutions for companies globally. CLS currently has a market cap of $4.4 billion, as its stock trades at $37.09 per share after rocketing by 143% in 2023 so far.
Geographically, Celestica’s revenue is well diversified. Based on its 2022 financial figures, the company made slightly more than 65% of its revenue from Thailand, while Malaysia and China also accounted for a significant portion of its total sales.
The recent solid gains in CLS stock could be attributed to the consistency in its financial growth trends. Despite the ongoing macroeconomic challenges, Celestica’s revenue grew positively by about 12% year over year in the first three quarters of 2023 combined to US$5.8 billion. During the same nine months, its adjusted earnings also jumped around 24% from a year ago to US$1.67 per share.
Going forward, you can expect Celestica’s growth trends to improve further with the help of strong secular tailwinds and new program wins. And these are also the key reasons why the company recently raised its full-year 2024 outlook. Considering these positive factors, CLS stock looks attractive to buy today for the long term, despite its significant gains in the last year.
Dye & Durham stock
Dye & Durham (TSX:DND) is another top Canadian stock I find undervalued today based on its long-term financial growth prospects. The company primarily focuses on providing technological solutions to improve the efficiency and productivity of legal and business professionals. DND stock has a market cap of around $760 million as it trades at $13.81 per share after declining by 16% year to date.
Although the challenging macroeconomic environment has badly hurt the real estate industry, leading to a weakness in Dye & Durham’s financial growth trends, the demand for its technological solutions remains stable.
I expect its financial growth trends to witness massive improvements in the long run as DND’s management has recently increased its focus on debt reduction and balance sheet flexibility by announcing the strategic review of its non-core assets. This announcement could also be the primary reason why Dye & Durham’s share prices rallied by more than 70% in November 2023 alone.