The ongoing uncertainty in both the economy and stock market has already begun to send many stocks lower, creating a number of attractive opportunities for Canadian value investors.
So, although the current environment requires investors to be diligent and proceed with caution, you also don’t want to miss the opportunity to buy some of the best Canadian stocks while they temporarily trade undervalued.
With that in mind, if you’ve got cash that you’re looking to invest today, here are five of the best value stocks that Canadian investors can buy now.
Source: Getty Images
Two top Canadian real estate stocks for value investors to buy now
Amidst the escalating uncertainty in the stock market today, some of the best and most reliable stocks to buy now are real estate stocks, such as InterRent REIT (TSX: IIP.UN) and CT REIT (TSX: CRT.UN).
InterRent REIT is an ideal stock to buy now because it’s not only ultra-cheap, but as a residential REIT it’s one of the most defensive investments you can make today.
Plus, in addition to the confidence you can have buying InterRent in this environment, the stock could also start to see a rally in the near term after yesterday’s reduction in interest rates by the Bank of Canada and the activist hedge fund Anson recently building a 9% stake in the residential REIT.
To get an idea of just how cheap InterRent is, the REIT currently trades at a forward price-to-funds-from-operations ratio of 15.8 times, well below its five-year average of 24 times.
Meanwhile, although CT REIT owns retail properties, which aren’t as resilient as residential properties, its majority owner and largest tenant is Canadian Tire, which sells many essential items and could benefit from the ongoing ‘buy Canadian’ initiative. In fact, Canadian Tire accounts for more than 90% of CT REIT’s income.
Therefore, while CT REIT trades off its highs and offers a current yield of roughly 6.3%, above its five-year average of 5.7%, it’s one of the best value stocks Canadian investors can buy now.
Three high-quality defensive growth stocks
In addition to reliable real estate stocks, defensive growth stocks that are trading undervalued are also some of the best stocks to buy now.
For example, Jamieson Wellness (TSX: JWEL), which sells essential health products like vitamins and other supplements is trading more than 25% off its 52-week high. Furthermore, its forward price-to-earnings ratio currently sits at just 14.9 times, below its five-year average of 22.1 times.
And while Jamieson manufactures some products in Canada that it sells to the U.S., those sales account for less than 10% of its total revenue.
Therefore, given its limited exposure to the U.S. and the fact that the products it sells are essential, Jamieson is not just a top value stock that Canadian investors can buy now, it’s also one of the best defensive growth stocks to buy and hold for the long haul.
Brookfield Infrastructure Partners (TSX: BIP.UN) is another reliable defensive growth stock trading off its highs that you’ll want to consider buying today.
Not only does it have compelling long-term growth potential and offer an attractive yield of 6.1%, but its operations are also highly reliable.
Brookfield owns a well-diversified portfolio of essential infrastructure assets located all over the world. In addition, should the ongoing trade war lead to significant inflation — which many economists are predicting — roughly 75% of its revenue is indexed to inflation.
Today the stock is trading over 20% off its 52-week high, and its forward enterprise value to earnings before interest, taxes, depreciation and amortization (EV/EBITDA) ratio is just 19.5 times, below its five-year average of 22.5 times.
Finally, WELL Health Technologies (TSX: WELL) is another top value stock that Canadian investors can buy today. WELL has been rapidly acquiring Canadian medical outpatient clinics and improving their economics, leading to significant growth in its profitability.
Furthermore, as the largest owner/operator of these clinics in Canada, its operations are robust and reliable. So even if the economy was to temporarily fall into a recession, the impact on WELL Health’s business should be minimal.
And not only is it a reliable stock you can have confidence buying today, but it currently trades more than 30% off its 52-week high, making it one of the best Canadian value stocks that investors can buy now.
