While $50 may not seem like much, it can definitely be a starting point for investing in stocks. There are several low-priced Canadian stocks with strong fundamentals and significant growth prospects that can help generate notable capital gains in the long term. However, the key is to start investing and be consistent over time, even with small amounts.
Against this background, let’s look at the three no-brainer stocks to buy with $50. These stocks are trading at discounted valuations and are likely to benefit from secular tailwinds.
Well Health
Speaking to stocks to buy with $50, investors could consider WELL Health Technologies (TSX: WELL). This digital healthcare company has been growing rapidly and consistently delivering solid sales growth for the past several quarters. Strong organic sales driven by increased omnichannel patient visits and the company’s focus on accretive acquisitions position it well to deliver strong growth in the coming years.
WELL Health’s omnichannel business model with a highly predictable revenue base and comprehensive cost-cutting program to strengthen its operational efficiency augur well for long-term growth. Moreover, the company’s focus on pursuing profitable growth strategies will likely drive its cash flows and fund its organic growth and acquisitions. In addition, WELL Health is solidifying its position in artificial intelligence (AI)-powered preventative care and is focusing on developing advanced AI tools, which will benefit the company.
While WELL Health has solid growth prospects, its valuation is near an all-time low. For example, WELL stock sports a next 12-month enterprise value/sales multiple of 1.5, which is significantly below its historical average, providing a good buying opportunity.
Telus
Shares of the leading telecom company Telus (TSX: T) could be a solid addition for regular income and growth. The company has consistently delivered solid financials and robust cash flows, enabling it to fund its growth initiatives and enhance its shareholders’ returns through share buybacks and higher dividend payments.
For instance, Telus has returned approximately $25 billion via dividends and share buybacks to its shareholders since 2004. Further, the company plans to grow its annual dividend by 7-10% under its multi-year dividend-growth program.
Telus’s continued investment in network infrastructure and the expansion of 5G services will likely help to boost its customer base and reduce churn. In addition, the company’s investment in digitization and AI technology will likely improve its customer service and network, drive margins, and accelerate cash flow growth. In summary, Telus is poised to grow its customer base and manage its costs effectively, which will likely drive its earnings, support higher dividend payouts, and push the share price higher.
Lightspeed
Lightspeed (TSX: LSPD) is another attractive stock to buy with $50. Shares of this technology company are trading at a discounted valuation. However, its fundamentals remain strong, and the company is on track to deliver solid revenue growth and sustainable earnings.
The company is delivering solid organic sales thanks to the growing adoption of its digital products and structural shift in selling models towards omnichannel platforms. Further, Lightspeed will likely see an acceleration in demand for its offerings as more merchants upgrade their traditional payment systems and invest in technology.
Besides benefitting from secular tailwinds, Lightspeed is likely to gain from the expansion of its customer base with high gross transaction value (GTV). These high GTV customers are more likely to adopt its multiple modules, thus boosting its average revenue per user and reducing churn. Further, the company’s strategy of integrating payments into its software platform will enable it to improve unit economics and margins.
Along with solid organic growth, Lightspeed’s focus on strategic acquisitions will help expand its customer locations, product portfolio, and strengthen its competitive positioning. With its low valuation and solid growth prospects, Lightspeed is a compelling stock to buy now.
