The Canadian stock market may be soaring right now but there are still plenty of deals out there. The S&P/TSX Composite Index is up more than 15% in 2024. Even so, there’s no shortage of discounts on the TSX to take advantage of today.
I’ve put together a basket of three beaten-down Canadian stocks that have seen better days. All three stocks are not far removed from delivering market-crushing returns, yet all three are currently trading far below all-time highs.
I wouldn’t recommend these three companies to an investor who’s looking for short-term returns in the stock market. These three picks could be in for more pain before they return to their market-beating ways. But for those who are willing to be patient, these three companies deserve serious consideration at these prices.
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Stock #1: Lightspeed Commerce
It’s been a wild ride for Lightspeed Commerce (TSX: LSPD) shareholders, of which I am one, over the past couple of years. Shares are down more than 80% below all-time highs from 2021 and are trading close to the price that the company went public at in 2019.
For investors who have been able to time it well, Lightspeed could have been an incredible investment. But for any long-term investors who have added to their positions over time, it’s been a disappointing investment.
Putting aside the recent performance of the tech stock, the business itself is poised for double-digit revenue growth rates for years to come, which is why I continue to hold my shares.
It’s worth noting that the company is currently exploring options for a potential sale. For long-term bag holders, that might mean not being able to close your position in positive territory. But for new Lightspeed shareholders, a near-term sale could result in a short-term gain.
Stock #2: WELL Health Technologies
The pandemic sent telehealth stocks like WELL Health Technologies (TSX: WELL) soaring for huge short-term gains. At one point in 2020, shares of WELL Health were up more than 400%. Today, the growth stock is down 50% from all-time highs yet is up close to 200% from pre-pandemic prices.
Demand for virtual health care surged during the pandemic, which understandably has since largely slowed down. But even with the slowdown in demand, I remain extremely bullish on the long-term growth potential of the telehealth space.
WELL Health Technologies offers investors direct exposure to the telehealth space. And at a share price that’s currently below $5, that exposure comes at an extremely low cost to entry.
Stock #3: Air Canada
Fresh off an impressive quarterly report, Air Canada (TSX: AC) shareholders finally have something to cheer about. The company not only beat revenue and earnings expectations but also raised full-year guidance and announced a share-buyback program, which led to the stock popping close to 15% on the day that earnings were released.
Contrary to most of its North American peers, Air Canada does have a track record of delivering market-beating returns. That’s what makes Canada’s largest airline such an interesting buy today.
Shares are down more than 50% below all-time highs, which were set before the pandemic. The stock might take some time before setting new all-time highs and returning to its market-beating ways, but there’s finally some positive momentum to be bullish about.
