3 TSX Stocks I’d Snap Up on Any Dip Right Now

Dips can create better entry points in solid businesses, especially in aerospace, autos, and building materials.

Amy Legate-Wolfe

Author Bio Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Her work can also be found at Canada's National Observer, where she writes on the business side of climate action. Before joining Motley Fool Canada, Amy wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Social Media Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published May 8, 4:30 pm EDT

Key Points

Magellan Aerospace is seeing improving revenue and margins, but its valuation works best after a pullback.
AutoCanada is in a rough patch, yet could rebound if rates ease and vehicle demand stabilizes.
Doman looks steadier with earnings, a dividend, and housing leverage, though lumber and debt risks remain.

Dips can feel uncomfortable, but they can also hand investors better prices on businesses already moving in the right direction. The trick isn’t chasing every falling stock. It’s looking for companies with real operations, improving demand, solid earnings power, and a reason to recover once the market calms down. Right now, that points to names tied to aerospace, autos, and building materials. Each carries risk, of course. Yet each also has a clear business case if investors get a better entry point.

MAL

Magellan Aerospace (TSX: MAL) looks like the kind of stock that could reward patience on weakness. Magellan makes parts and systems for the global aerospace and defence industries, so it benefits when aircraft production, defence spending, and repair demand improve. That’s relevant now as aerospace supply chains continue to normalize, while airlines and governments still need more equipment. Over the last year, Magellan stock also gained attention as investors warmed up to industrial stocks with steady end-market demand.

The latest earnings showed why the stock deserves a closer look. In the fourth quarter of 2025, revenue rose 15.6% to $278.3 million. Gross profit climbed to $45.2 million from $32.4 million a year earlier, showing better margins and stronger volumes. Net income fell to $10.6 million from $15.9 million, partly due to an environmental provision, so the story isn’t perfect. Magellan stock trades at a rich trailing price-to-earnings (P/E) ratio of around 36 at writing, though the forward multiple looks more reasonable at 18.8. That means investors need growth to show up. A dip could make that bet far more attractive.

ACQ

AutoCanada (TSX: ACQ) brings a very different setup. It operates car dealerships across Canada and the United States, selling new and used vehicles while also earning from financing, insurance, service, parts, and collision repairs. This stock fits a dip-buy list because investors have already seen how quickly sentiment can sour when consumers pull back. If affordability improves, interest rates ease, or vehicle demand stabilizes, AutoCanada could recover from a tough stretch.

The company’s fourth quarter showed both the risk and the potential. Revenue from continuing operations fell 11.8% to $1.1 billion, while adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) dropped 39.9% to $32.7 million. AutoCanada also posted a total net loss of $14.6 million. That’s not a pretty quarter, yet full-year adjusted EBITDA rose 11.5% to $198 million, helped by cost cuts and a sharper focus after a difficult operating period. The valuation still looks cautious, with the stock trading around 25 on trailing earnings based on recent data. That’s not dirt cheap, but it could work if earnings recover. The risk is simple, as consumers may stay stretched longer than bulls expect.

DBM

Doman Building Materials (TSX: DBM) may be the steadiest name on this list. It distributes building materials across Canada and the United States, including lumber, treated wood, siding, fencing, and related products. That ties it to housing, renovation, repair, and construction spending. Investors may like it now because housing sentiment could improve if borrowing costs ease, while Doman’s acquisitions and broader product mix give it more ways to grow than a plain lumber story.

The numbers back up that case. In 2025, revenue reached $3.1 billion, up 17.1% from 2024. Net earnings came in at $80.3 million, while EBITDA reached $256.4 million. In the fourth quarter, revenue was $644.2 million, net earnings rose to $11 million, and the company declared a $0.14 quarterly dividend. The valuation also looks reasonable, with the stock trading around 11 times trailing earnings and a forward multiple of 13. Risks remain, especially weaker lumber prices, slow housing activity, and debt from acquisitions. Still, Doman offers income, scale, and a practical business investors understand.

Bottom line

A good dip-buy stock doesn’t need a perfect story. In fact, the best opportunities often come with a few dents already visible. Magellan stock offers aerospace growth, AutoCanada offers recovery potential, and Doman offers income with housing upside. If the market gives investors a cheaper price, these three deserve a spot near the top of the watch list.