Have $500? 3 Absurdly Cheap Stocks Long-Term Investors Should Buy Right Now

Canadian stocks like Lightspeed are trading incredibly cheap, providing excellent buying opportunity to long-term investors.

| More on:
sale discount best price

Image source: Getty Images

As the economy displayed remarkable resilience, the equity market experienced a revival in 2023. Additionally, the anticipated moderation in interest rates provides a solid foundation for growth in stocks. Despite these positives, some fundamentally strong stocks are still trading absurdly cheaply, offering an excellent buying opportunity at current levels.

With this backdrop, let’s explore three cheap Canadian stocks long-term investors should buy right now with $500. 

Lightspeed 

Lightspeed (TSX:LSPD) offers a cloud-based commerce platform for small- and medium-sized businesses. While Lightspeed continues to perform well, shares of this technology company are trading incredibly cheap. It’s worth highlighting that Lightspeed stock sports an enterprise value-to-sales (EV/sales) multiple of 2.2, significantly lower than its historical average of about 15 and is near an all-time low. 

Lightspeed stock offers significant value near the current levels. Meanwhile, the company is poised to capitalize on the growing shift in selling models towards omnichannel platforms. With the expected improvement in the economy, retailers and restaurant operators are likely to invest in technology and upgrade their payment systems. This will drive demand for Lightspeed’s digital products and payment solutions. 

Furthermore, Lightspeed stock will likely benefit from the shift in its go-to-market approach. The company focuses on expanding its high gross transaction value (GTV) customer base. Notably, these customers have the resources to adopt its multiple modules, driving its average revenue per user and reducing churn. 

Besides growing organically, Lightspeed’s focus on accretive acquisitions will accelerate its growth rate by expanding its customer locations and strengthening its competitive positioning. 

WELL Health 

Shares of digital healthcare company WELL Health Technologies (TSX:WELL) are another compelling long-term pick. The company has been consistently achieving record revenue (for 19 consecutive quarters) and is profitable. While WELL Health is performing exceptionally well, its stock has an EV/sales multiple of 1.5, which is at an all-time low and much lower than its historical average. 

What stands out is that WELL Health has increased its 2023 top-line guidance four times. Further, it expects to exceed $900 million in annual revenue through organic growth in 2024. This reflects a continued increase in omnichannel patient visits. 

Looking ahead, WELL Health’s focus on driving organic sales and investments in artificial intelligence will accelerate its growth. Moreover, its accretive acquisitions will support its cash flows and drive its market share. 

Aritzia

Shares of the luxury fashion house Aritzia (TSX:ATZ) stock lost substantial value over the past year. The stock dipped nearly 47%, significantly underperforming the broader equity market. This notable correction reflects a slowdown in its growth rate due to the lack of newness in its products, macro headwinds, and tough year-over-year comparisons. 

While Aritzia stock is trading at a discounted valuation due to the decline in its value, it is focusing on introducing new styles to accelerate its top-line growth. Moreover, the strength of its e-commerce platform and ongoing expansion of boutiques will support its financials and share price. 

The company projects its top line to grow at an average annualized rate of 15-17% through fiscal 2027. Meanwhile, its efforts to control costs and improve pricing will drive its earnings and share price.

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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Aritzia. The Motley Fool recommends Lightspeed Commerce. The Motley Fool has a disclosure policy.

More on Investing

Bank sign on traditional europe building facade
Bank Stocks

Better Bank Stock: BNS vs. BMO

TSX bank stocks such as BNS and BMO offer tasty dividend yields while trading at cheap valuations in 2024.

Read more »

A plant grows from coins.
Dividend Stocks

With a 7.9% Dividend, This TSX Stock Can Help You Make $1,975 Per Year

Make steady income with this high yield dividend stock. This Canadian corporation has increased its dividend for 29 years.

Read more »

grow dividends
Dividend Stocks

2 Dividend Stocks to Use as Building Blocks for Lasting Wealth

Dividend stocks that are raising their dividends over time could create lasting wealth for investors. Here are a couple of…

Read more »

Glass piggy bank
Dividend Stocks

New Investors: How to Make the RRSP Work for You Now and Not Just in Retirement

The RRSP can work for you in retirement, but it can also bring huge benefits right now for investors looking…

Read more »

Senior couple at the lake having a picnic
Dividend Stocks

Retirees: 2 High-Yielding Dividend Stocks to Buy Today

These TSX dividend-paying stocks can be a retiree’s best friend in their self-directed portfolios for additional income in retirement.

Read more »

money while you sleep
Dividend Stocks

2 Stable Stocks for Sleep-Better Investing

Boasting rock-solid underlying businesses and great financials, these two stable stocks can be perfect holdings for your portfolio.

Read more »

Money growing in soil , Business success concept.
Investing

3 Growth Stocks to Keep Your Eyes on

Growth stocks could make you lots of money, especially if you are able to buy them on sale and hold…

Read more »

Dividend Stocks

2 Dividend Stocks to Double Up on Right Now

After their recent declines, these two Canadian dividend stocks look even more attractive to buy for the long term.

Read more »