While many of the best TSX stocks are now trading near their 52-week highs, bargain hunting has become increasingly challenging. Even so, a handful of high-quality Canadian companies have pulled back and are trading cheap despite continuing to deliver strong operating results, creating attractive buying opportunities for long-term investors.
Against this backdrop, here are five cheap TSX stocks to consider before the market notices.
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Shopify
Shopify (TSX: SHOP) stock is down more than 29% from its 52-week high amid macroeconomic uncertainty, valuation concerns, and fears that artificial intelligence (AI) could disrupt software companies. Despite recent challenges, the Canadian tech giant’s fundamentals remain solid, and it continues to capitalize on the ongoing shift toward omnichannel selling platforms.
Shopify is likely to benefit from its expanding gross merchandise volume (GMV) led by larger businesses. Merchants generating over $25 million in GMV are growing the fastest. Further, it is also gaining traction with enterprise customers. In addition, solid momentum in offline commerce and the B2B segment further strengthens its outlook. Also, higher adoption of its unified commerce platform and Shop Pay position it well to deliver solid growth, which will likely support a solid recovery in its share price.
Stantec
Stantec (TSX: STN) is another top TSX stock trading cheap. Shares of this engineering and environmental consulting services provider are down nearly 34% over the past year on valuation concerns and fears that AI could disrupt its business. Despite the decline, its fundamentals remain strong, and the pullback has made the stock more reasonably valued.
Demand remains healthy across infrastructure, water, transportation, and environmental projects, while long-term trends such as climate change, energy transition, urbanization, and resource security continue to drive growth. Stantec is also expanding in high-value areas such as smart cities, hospitals, and data centres. Its $9 billion backlog provides revenue visibility and strengthens confidence in its long-term growth prospects.
MDA Space
MDA Space (TSX: MDA) stock is down about 38% from its 52-week high due to valuation concerns and dilution fears related to its Collecte Localisation Satellites (CLS) acquisition. However, the drop has created a solid buying opportunity.
MDA Space is well-positioned to benefit from the expanding space economy through its satellite systems, robotics, and geointelligence businesses. Rising defence spending and demand for space-based technologies provide solid long-term growth drivers. The CLS acquisition enhances MDA’s AI-powered Earth observation and satellite IoT capabilities, boosting recurring revenue and expected earnings.
With a $40 billion opportunity pipeline over the next five years, and growing demand for satellite and geospatial services, MDA offers compelling long-term growth potential.
Cameco
Cameco (TSX: CCO) stock has fallen about 31% from its high amid valuation concerns and weaker spot uranium prices. Despite the pullback, Cameco remains well-positioned for long-term growth as rising electricity demand from AI, electrification, decarbonization, and energy security boosts nuclear power adoption and uranium demand.
Cameco’s portfolio of high-grade, low-cost uranium assets, combined with investments across the nuclear fuel cycle, strengthens its competitive position. Its disciplined production strategy and long-term supply contracts also provide more stable earnings while reducing exposure to uranium price volatility, making the stock an attractive buy ahead of a potential recovery.
Dollarama
Dollarama (TSX: DOL) stock looks attractive following the recent pullback. The leading discount retailer benefits from a resilient business model that performs well in all economic conditions. Its broad assortment, fixed and low prices, and growing penetration of high-margin private-label offerings help attract a wide customer base while supporting consistent profitability.
Thanks to its defensive business model, Dollarama has consistently delivered steady revenue and earnings growth over the years. Strong financial performance has also enabled Dollarama to increase its dividend regularly since 2011, providing shareholders with a growing stream of income in addition to capital appreciation.
Looking ahead, Dollarama’s expanding store network, international opportunities, strengthening delivery partnerships, and efficient sourcing practices position it well to deliver strong growth.
