We’ve been moving through quite the wild quarterly earnings season of late, with big tech numbers (mostly) coming in ahead of expectations. Undoubtedly, with more numbers to go, questions linger as to what this market’s next trajectory will be after ascending steadily since the start of the year.
Indeed, artificial intelligence (AI) firms have continued to steal the show, with the recent round of AI chip numbers coming in not only ahead of the estimates, but above and beyond. Indeed, the top AI chip plays will eventually come back down to Earth. But for now, the path of least resistance seems to be higher, which bodes well for the broader basket of high-tech plays.
In this piece, we’ll have a look at two intriguing TSX stocks that I think are compelling buys after their recent quarterly earnings beats. Of course, it may not feel great to be a buyer of a stock that’s already had a nice run after clocking numbers that were better than expected (or feared). In any case, I think the following plays remain undervalued after reporting some pretty decent results, which, I believe, may not have fully reflected in the share price.
Without further ado, let’s look at two intriguing stocks that may be interesting names to stash on the watchlist after recent numbers.
Bausch + Lomb
First, we have eye health firm Bausch + Lomb (TSX: BLCO), which recently clocked in some stellar quarterly earnings results. The stock surged higher after the number, and though I’m no fan of chasing stocks after upward spikes, I think that the results could mark the start of a sustained multi-week move higher, perhaps much higher, as investors have more of a chance to digest the incredible results.
Total revenues were up 10% year over year, thanks in large part to Xiidra drug, which treats dry eye. Indeed, Vision Health continues to be the main growth pillar for Bausch + Lomb, growing at around 18% for the quarter. Looking ahead, the $7.9 billion firm has never looked better. And I still think shares are quite cheap for the high-quality vision franchise you’re getting.
Hats off to the management team for the solid quarter. I think it’s just an appetizer for what’s to come as the firm looks to bolster its moat around the vision care space. Even after the latest spike to $22 and change per share, shares of BCLO are still off more than 10% over the past year. In short, there’s room for BCLO stock to run after one of its best showings in quite a while!
Restaurant Brands International
Restaurant Brands International (TSX: QSR) is another firm that could serve up some nice returns for investors over the long run. Though shares slipped to $102 and change, I still think too many folks are underrating the firm following its latest quarterly earnings results.
Restaurant Brands saw its profit surge by nearly 16%. With an aggressive expansion underway and a strategy to get customers coming back, I’d not dare bet against QSR stock as it wanders below its all-time highs.
At 20.1 times trailing price to earnings, I consider the 3% yielder to be an absolute bargain hiding in plain sight, especially if you have doubts about the economy’s growth prospects through the year. Restaurant Brands is a defensive growth king with a solid dividend that’s also poised for steady gains!
