The Canadian equity market has maintained its strong momentum in 2025, with the benchmark index rising over 17.7% year to date. Notably, TSX stocks across sectors have delivered impressive gains. Yet, even as the broader market pushes higher, opportunities still exist as some fundamentally solid companies remain undervalued.
For long-term investors, these shares offer compelling entry points. Against this background, here are the best undervalued stocks I’d buy right now.
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Undervalued stock #1: goeasy
goeasy (TSX:GSY) is a no-brainer for investors looking for value, growth, and income. This financial services provider has been expanding rapidly, delivering double-digit sales and earnings growth. For instance, the subprime lender’s top line has increased at a compound annual growth rate (CAGR) of 22.7% over the last five years. At the same time, its earnings grew at a CAGR of 23%. Adding to its appeal, goeasy has distributed dividends for 21 consecutive years and consistently lifted its payouts for 11 straight years.
Despite this momentum, its stock trades at 10.2 times its expected earnings for the next 12 months, a modest multiple given its strong growth potential and reliable dividend expansion. Its leadership in Canada’s subprime lending space positions it well to capitalize on resilient demand for credit. Management projects its consumer loan portfolio to reach $7.35–$7.75 billion by 2027, which is expected to drive double-digit revenue growth. While yields may edge lower as the company emphasizes secured loans, this shift reduces credit risk and adds earnings stability.
The company is also broadening funding sources, diversifying products, and expanding into new regions. These initiatives, along with disciplined underwriting practices, consistent credit performance, and operational efficiency, will help goeasy sustain double-digit earnings growth.
With double-digit growth expected to continue, dependable dividends, and a valuation that leaves room for upside, goeasy stands as an attractive investment for long-term investors.
Undervalued stock #2: Cargojet
Cargojet (TSX:CJT) is a bargain near the current market price. The stock has slipped about 31% from its 52-week high of $144.97. Nonetheless, the company’s fundamentals remain strong as Canada’s leading air cargo operator consistently delivers solid financial results. Moreover, the upcoming holiday shopping season could give its financials and share price a significant lift.
Notably, the fourth quarter has historically been Cargojet’s busiest period, driven by surging e-commerce and retail demand. Besides this seasonal boost, Cargojet’s underlying business remains solid. Its long-term contracts, including minimum volume guarantees and inflation-linked pricing, add stability to its operations, drive cash flow, and offer margin protection. With about three-quarters of its domestic revenue coming from these agreements, its business remains resilient to volatility.
Cargojet’s recent performance reflects this momentum. In the first half of 2025, Cargojet saw strong growth across domestic and charter operations, supported by disciplined cost management. Its focus on lowering debt and expanding its network further strengthens its outlook. Operating 41 freighters, most of which it owns, gives the company both scale and flexibility without the burden of costly fleet expansion.
Further, Cargojet’s dominant position in time-sensitive freight and tailwinds from e-commerce growth position it well to deliver strong growth. Meanwhile, the current pullback in its stock price offers a compelling entry point.
