3 Cheap (Under-$20) Stocks to Buy Now
The Motley Fool
Published Dec 08, 2021 13:00
Updated Dec 08, 2021 13:15
3 Cheap (Under-$20) Stocks to Buy Now
Several TSX stocks have corrected in 2021, losing a substantial portion of their value. Valuation concerns, tough comparisons, and an expected moderation in growth rate can be attributed to this decline.
The pullback in price has made these stocks cheap, presenting a unique opportunity for investors to accumulate some of the top Canadian stocks at current levels. Here’s my list of three cheap stocks that are trading under $20 and have a solid runway for growth.
Absolute Software Absolute Software (TSX:ABST)(NASDAQ:ABST) has corrected about 55% from its peak. Moreover, it has declined nearly 25% on a year-to-date basis. The selling in Absolute Software stock reflects investors’ fear that its solid financial performance is tied to the pandemic, and its growth could decelerate in the post-pandemic world.
There is no denying that Absolute Software benefitted from the work-from-anywhere trend amid the COVID-19 pandemic. However, the company could continue to deliver strong financials, even in the post-pandemic era. My bullish outlook is based on Absolute Software’s ability to grow the addressable market through product innovation and channel and geographic expansion.
Furthermore, its strong management team, strategic capital allocation, cross-selling ability, and higher net dollar retention rate augur well for growth. Absolute Software stock is trading at a forward EV/sales multiple of 3.3, which is lower than its historical average and peers.
WELL Health (TSX:WELL) Like Absolute Software stock, WELL Health Technologies (TSX:WELL) witnessed strong selling in 2021 and has corrected about 31% year to date. WELL is digitizing the healthcare sector and saw strong demand amid the COVID-19 pandemic. I believe the use of technology in the healthcare segment could continue to accelerate, and WELL, with its omnichannel patient services offerings, remains well positioned to capitalize on the demand.
WELL’s extensive network of outpatient medical clinics and multi-disciplinary telehealth offering augur well for growth. It is rapidly expanding and acquiring clinical and digital healthcare assets, which will likely drive its growth. The company recently announced that its organic growth in the virtual services business remains strong and recorded more than 50% growth on a year-over-year basis.
WELL has delivered positive adjusted EBITDA in the past four quarters and could continue to deliver strong adjusted EBITDA in the coming years. Its forward EV/sales multiple is at a multi-year low, making it an attractive investment at current levels.
BlackBerry BlackBerry (TSX:TSX:BB)(NYSE:BB) stock is up about 39% this year. However, it has declined nearly 67% from its 52-week high, presenting a solid opportunity to buy the shares of this high-growth company. The ongoing spending on cybersecurity and digital transformation provide a multi-year growth opportunity for BlackBerry stock.
Get The App
Strong billings and product innovation continue to fuel growth in its cybersecurity business. Moreover, BlackBerry continues to acquire customers, which augurs well for growth. Overall, its large and growing addressable market and strong footprint in the electric vehicle segment position it well to deliver strong financials.
BlackBerry’s strong competitive positioning in the IoT market, strong customer base, solid recurring product software revenue, and high dollar-based net retention rate will likely support its stock price.
The post 3 Cheap (Under-$20) Stocks to Buy Now appeared first on The Motley Fool Canada.
Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Absolute Software Corporation.
This Article Was First Published on The Motley Fool
Written By: The Motley Fool
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.