The TSX Composite benchmark has surged well over 60% in the last three years. Yet history shows that rallies rarely lift every stock with healthy fundamentals equally. Some businesses fall behind despite delivering stable results and improving balance sheets. This is where undervalued stocks to buy often hide, and investors focusing only on index performance may miss these gaps.
While such stocks may not grab headlines today, their underlying numbers and growth prospects tell a different story. Let’s take a closer look at two undervalued Canadian stocks to buy that may be flying under the radar right now but could be poised for a breakout in 2026.
Source: Getty Images
goeasy stock
As we shift our focus from market momentum to fundamentals, the Canadian consumer lender goeasy (TSX:GSY) starts to look mispriced. To put it simply, this Mississauga-based financial services company provides non-prime consumer lending through its easyfinancial and easyhome brands across Canada.
Despite the broader market rally in 2025, its shares have fallen nearly 22%. As a result, GSY stock currently trades around $131 per share, giving it a market cap of roughly $2.1 billion. It also pays a quarterly dividend with an annualized yield of about 3.5%.
GSY stock’s recent performance partly reflects concerns around the broader economic backdrop rather than weak demand for its services. In the third quarter of 2025, goeasy’s loan originations rose 13% YoY (year-over-year) to $946 million, while its loan portfolio expanded 24% to $5.4 billion. During the quarter, the company’s revenue climbed 15% YoY to a record $440 million with the help of higher loan balances and strong application volumes. However, its adjusted quarterly earnings still fell 5% YoY to $4.12 per share, mainly due to higher credit provisions and margin pressure from a more cautious borrower environment.
Despite these short-term headwinds, goeasy’s credit quality improved in the latest quarter, with its net charge-off rate declining to 8.9%. Meanwhile, the company continues shifting toward more secure lending, lowering funding costs, and investing in underwriting and collections technology.
With consistent loan growth, strong cash generation, and over two decades of dividend payments, goeasy fits well as one of the undervalued Canadian stocks to buy now for investors willing to look past near-term volatility.
TFI International stock
Cyclical slowdowns often create valuation gaps, especially for transportation and logistics firms like TFI International (TSX:TFII). It operates across less-than-truckload, truckload, and logistics services segments in North America.
After plunging by nearly 26% over the last year, its shares now trade near $145 apiece, translating into a market cap of around $12 billion. This company also offers an annualized dividend yield close to 1.4%, with regular dividend increases.
In the latest quarter ended in September 2025, weaker freight demand weighed on TFI’s results. The company’s quarterly revenue declined to US$1.97 billion, while operating income fell to US$153.3 million. Lower shipment volumes across most segments also drove its adjusted earnings down to US$1.20 per share. Nevertheless, TFI still generated strong free cash flow of US$199.4 million during the quarter, comfortably supporting its dividends and ongoing share buybacks.
Meanwhile, TFI continues to prioritize margin discipline, cost control, and capital returns. With a solid balance sheet and a proven ability to navigate freight cycles, it remains one of the most attractive undervalued stocks to buy in Canada for patient long-term investors.
