You don’t require huge capital to start your investment journey. Small but regular investments can create massive wealth in the long term. Against this backdrop, let’s look at three under-$20 stocks that are excellent additions to your portfolio.
WELL Health Technologies
WELL Health Technologies (TSX: WELL) develops and provides products and services to aid healthcare professionals in delivering positive patient outcomes. Supported by its organic growth and strategic acquisitions, the company has grown its top line by 39.5% in the first six months. Amid the top-line growth, its adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) and EPS (earnings per share) have grown by 8.7% and 8.3%, respectively.
Meanwhile, WELL Health’s addressable market is expanding amid the growing adoption of virtual services, digitization of patients’ records, and increased usage of software services in the healthcare sector. Meanwhile, the company continues to expand its footprint through acquisitions. In June, it acquired 10 clinics in British Columbia and Ontario from Shoppers Drug Mart. The company continues to invest in artificial intelligence to develop innovative tools to improve patient experience.
Along with these growth prospects, WELL Health’s cost-optimization initiatives and falling debt levels could boost its profitability in the coming quarters. The company’s valuation looks attractive, with its NTM (next-12-month) price-to-earnings multiple at 15, making it an attractive buy.
NorthWest Healthcare Properties REIT
Second on my list is NorthWest Healthcare Properties REIT (TSX:NWH.UN), which pays monthly dividends at a higher yield of 7.16%. The company generates stable and predictable cash flows, given its defensive healthcare properties, long-term lease agreements, government-backed tenants, and inflation-indexed rent. The company’s adoption of the non-core assets sales program has helped it raise around $1.4 billion. The company has utilized the net proceeds from these sales to repay high interest-bearing debt, thus lowering its debt levels.
NorthWest Healthcare focuses on developing next-generation properties, which could deliver long-term earnings growth for its shareholders. Meanwhile, its price-to-book value stands at an attractive 0.7. Considering its stable cash flows, high dividend yield, and attractive valuation, I believe NorthWest Healthcare would be an excellent addition to your portfolio.
Lightspeed Commerce
Lightspeed Commerce (TSX: LSPD) offers commerce solutions to various businesses worldwide. Amid the concerns over the global economy, the company has been under pressure over the last few months, losing over 40% of its stock value compared to its 52-week high. Its valuation has declined to attractive levels, with its NTM price-to-sales multiple at 1.6.
Meanwhile, the expansion of the omnichannel selling model has created a long-term growth potential for Lightspeed Commerce. It is introducing new products and geographically expanding the availability of its products, which could boost its customer base and average revenue per user in the coming quarters. Also, the company’s introduction of the unified POS and payments offering has resonated well with its customers, increasing the adoption of its payment offerings.
Along with these growth initiatives, the company also focuses on right-sizing its cost structure and improving its efficiencies, which could drive its profitability. Meanwhile, the company’s management projects its top line to grow by 20% this year. Its adjusted EBITDA could improve substantially from $1.3 million in the previous fiscal year to around $45 million. Considering its growth prospects and improving profitability, Lightspeed would be an excellent buy right now.
