3 Canadian Value Stocks I’d Consider for My Long-Term TFSA Strategy

Here’s why you should consider holding undervalued Canadian growth stocks such as Kraken Robotics in the TFSA right now.

Investing in undervalued growth stocks and holding them in the TFSA (Tax-Free Savings Account) should help Canadians generate outsized gains over time. As the TFSA is tax-sheltered, any returns earned in the registered account are tax-free.

In this article, I have identified three Canadian value stocks you can buy and hold in the TFSA right now.

Middle aged man drinks coffee

Source: Getty Images

Is this health-tech stock a good buy?

Valued at a market capitalization of $300 million, Healwell AI (TSX: AIDX) is a technology-focused healthcare company that offers an artificial intelligence (AI)-enabled decision support platform for healthcare providers.

According to estimates, Healwell is forecast to increase its sales from $39 million in 2024 to $191 million in 2026. Healwell AI reported exceptional fourth-quarter (Q4) results, with revenue surging 692% year over year to $15.2 million and gross profit jumping 1179% to $7 million. For the full year 2024, the healthcare software and AI company generated $38.9 million in revenue, up from a $7 million run rate when it launched in October 2023.

The company’s growth strategy is anchored by its acquisition of Orion Health, which is expected to add $25 million in quarterly revenue and make Healwell’s EBITDA (earnings before interest, tax, depreciation, and amortization) positive. This acquisition transforms Healwell into a global leader in healthcare AI, with access to over 150 million patient lives.

Healwell’s AI and data science division is gaining traction, with 30 master service agreements in place with pharmaceutical companies, including seven of the top 10 global pharmaceutical firms. It is strategically shifting its revenue mix toward higher-margin segments, with healthcare software expected to account for 70% of revenue after the Orion acquisition.

Management highlighted emerging opportunities from the “Buy Canadian” initiative, with increasing government interest in domestic healthcare technology solutions expected to drive additional growth in 2025.

Analysts remain bullish and expect the TSX stock to nearly triple from its current levels, based on consensus price targets.

Is this Canadian mining stock a good buy?

Magna Mining (TSXV: NICU) is positioning itself as a significant producer of copper and nickel in North America’s premier Sudbury mining district. It has established a robust portfolio of assets through strategic acquisitions, including the producing McCreedy West mine and development properties like Crean Hill, Levack, Podolsky, and Kirkwood.

Magna boasts substantial resources, including 780 million pounds of copper, 742 million pounds of nickel, and 2.6 million ounces of precious metals, with additional historical resources providing further upside potential.

For 2025, Magna is focused on optimizing McCreedy West to generate sustainable cash flow by ramping up production from 330,000 to 400,000-500,000 tonnes per annum while developing a restart plan for Levack Mine to commence production in 2026.

Magna employs a “bootstrapped” growth strategy, using cash flow from initial operations to fund expansion, creating a pipeline for organic growth. With strong institutional backing and a management team experienced in Sudbury mining operations, Magna is poised to transition into a mid-tier producer.

Analysts remain bullish on Magna Mining stock and expect it to gain over 50% from current levels.

Is this robotics stock undervalued?

Valued at a market cap of $581 million, Kraken Robotics (TSXV: PNG) stock has returned over 400% to shareholders. However, shares of the marine technology company are also down 23% from all-time highs.

Analysts tracking Kraken expect sales to rise from $69.6 million in 2023 to $126 million in 2025. Moreover, the growth stock is forecast to end 2026 with a free cash flow of over $20 million.

If the stock is priced at 50 times trailing free cash flow, it should more than double in valuation over the next two years. Bay Street remains bullish and expects the small-cap robotics stock to gain over 50% from current levels.

Fool contributor Aditya Raghunath has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Kraken Robotics. The Motley Fool has a disclosure policy.

More on Dividend Stocks

dividends grow over time
Dividend Stocks

How to Avoid a Big Tax Bill on Your RRSP in Retirement

A proven drawdown strategy can help avoid a big tax hit on your RRSP in retirement.

Read more »

customer uses bank ATM
Dividend Stocks

I Found a 5.6% Dividend Stock That Pays Monthly, Like an ATM for Your Retirement

With a 5.6% annualized yield, growing rental income, and monthly payouts, this Canadian REIT could help turn your retirement portfolio…

Read more »

people sit in two wooden beach chairs facing the Caribbean ocean holding drinks and making a toast
Dividend Stocks

Can You Really Live Off Dividends? A Realistic Look at the Numbers

Can you live off dividends? See how much you would need to invest, what BNS, CU, and ZWC could pay,…

Read more »

concept of growth
Dividend Stocks

TFSA Passive Income: Should You Buy This Dividend-Growth Stock for the 6% Yield?

This stock has delivered annual dividend increases for more than 30 years.

Read more »

ETFs can contain investments such as stocks
Dividend Stocks

This Monthly Income ETF Yields 6% and I Think Retirees Should Give it a Closer Look

The Purpose Global Bond Fund offers Canadian retirees a steady 6% yield and monthly payouts. Discover how the ETF can…

Read more »

dividends can compound over time
Dividend Stocks

I’d Rather Own SmartCentres at 98.1% Occupancy Than Chase a Bigger Yield

Before you chase a bigger yield, consider SmartCentres’ 98.1% occupancy, 6.9% yield, and the cash flow supporting its monthly distribution.

Read more »

Oil industry worker works in oilfield
Dividend Stocks

Enbridge vs. Canadian Natural Resources: Where I’d Put My Next $10,000

Let’s compare Enbridge and CNQ to see which offers the better mix of dividend income and growth potential.

Read more »

financial chart graphs and oil pumps on a field
Dividend Stocks

A 3.8% Monthly Payer for October: Here’s What $20,000 Would Collect

Given its solid financial position, promising growth prospects, established dividend track record, and reasonable valuation, Whitecap would be an excellent…

Read more »