Investing in cheap or undervalued stocks with strong fundamentals should help Canadians generate outsized gains over time. In this article, I have identified three TSX stocks that are trading at bargain prices in April 2025.
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Is this TSX stock undervalued right now?
Profound Medical (TSX:PRN) reported its strongest quarter yet, with fourth-quarter (Q4) revenue doubling year over year to $4.2 million and gross margins reaching 71%, up from 52% the previous year. It also reduced its net loss by 45% to $4.9 million.
The medical device maker, which specializes in MRI-guided prostate tissue ablation, is benefiting from Medicare reimbursement that took effect on January 1, 2025, at a higher payment level than competing technologies. Moreover, the management is transitioning from a placement model to capital sales while expanding its commercial team.
Profound’s TULSA-PRO system is positioned as uniquely capable of treating a broader range of prostate conditions thanks to its precision MRI-guided approach.
Analysts expect Profound to increase sales from $15.2 million in 2024 to $291 million in 2029. Its adjusted earnings are forecast to touch $4.42 per share in 2029 compared to a loss of $1.60 per share in 2024. If the TSX stock is priced at 20 times forward earnings, it should trade around $90 in early 2029, up from its current price of $6.46.
Is this small-cap TSX stock a good buy?
Valued at a market cap of $142 million, Electrovaya (TSX:ELVA) is engaged in the design, development, manufacture, and sale of lithium-ion batteries, battery management systems, and battery-related products.
According to Bay Street estimates, it is forecast to increase revenue from $44.6 million in fiscal 2024 (ended in September) to $254 million in fiscal 2029. Moreover, it is forecast to turn profitable and report an adjusted earnings per share (EPS) of $0.12 per share in 2025, compared to a loss of $0.04 per share in 2024. Its EPS is also forecast to expand to $0.88 in 2029.
So, if the stock is priced at 20 times forward EPS, it will trade around $ 17.50, indicating an upside potential of almost 400% from current levels.
Should you own this growth stock today?
The final undervalued TSX stock on my list is NanoExplore (TSX: GRA), which has a market capitalization of $408 million. NanoExplore manufactures and supplies graphene powder for use in the Australian industrial market. It offers graphene-based solutions, including GrapheneBlack powder and graphene-enhanced masterbatch pellets.
Analysts tracking NanoExplore expect the company’s revenue to increase from $130 million in fiscal 2024 (ended in June) to $339 million in 2028. It is forecast to report earnings of $0.22 per share in fiscal 2028, compared to a loss of $0.07 per share in 2024. Further, Bay Street projects its free cash flow to increase to $81.4 million in 2028, compared to an outflow of $10.3 million in 2025.
If the TSX stock is priced at 20 times forward FCF, it will be valued at a market cap of $1.6 billion, indicating an upside potential of 300% in the next two years. Analysts remain bullish and expect the chemicals stock to gain around 80% over the next 12 months.
