5 of the Best Undervalued TSX Stocks to Buy Under $100

It’s wise to invest in fundamentally strong stocks trading at attractive valuations. 

money cash dividends

Image source: Getty Images

As the Canadian equity market continues to trend higher, it’s wise to invest in fundamentally strong stocks trading at attractive valuations. 

With top-quality value stocks in the backdrop, let’s dig into five TSX stocks trading below $100 with solid potential for growth in the medium to long term. 

Absolute Software

Let’s start with Absolute Software (TSX:ABST)(NASDAQ:ABST) stock. I expect the company to benefit from the increased spending on cybersecurity threats. Meanwhile, its large addressable and high-growth market, lower churn, channel and global expansion, and pipeline of new products position it well to deliver solid revenue and adjusted EBITDA. Also, its strategic acquisitions and cross-selling opportunities augur well for growth. 

Despite its strong fundamentals, Absolute Software stock is undervalued. Its NTM (next 12-month) EV/sales multiple of 2.1 is lower than the historical average. Furthermore, Absolute Software stock is also trading cheaper than peers. 

Suncor Energy

Next up is Suncor Energy (TSX:SU)(NYSE:SU) stock, which is trading significantly lower than its historical average. Its NTM EV/EBITDA multiple of four is about 20% lower than the three-year average and well within investors’ reach.  

While its stock is trading cheap, the uptrend in crude price and improving energy demand provide a solid growth foundation. Meanwhile, Suncor’s integrated assets, favourable product mix, and focus on lowering breakeven costs bode well for growth. Suncor is reducing debt and continues to enhance investors’ returns through share buybacks and regular dividend payments. 

Scotiabank

Scotiabank (TSX:BNS)(NYSE:BNS) is another Canadian stock that looks attractive at current levels, despite the sharp recovery in its price. Its P/BV and P/E multiple of 1.4 and 10, respectively, are lower than its peers’ multiples. Meanwhile, improving economic trends, the expected increase in credit demand, and the rise in interest rates suggest that Scotiabank stock has ample room for growth.  

Scotiabank’s exposure to the high-quality, high-growth banking markets suggests it is well positioned to capitalize on improving operating environment. Furthermore, its strong credit quality, solid balance sheet, improved efficiency, and lower provisions will likely drive its profitability. Scotiabank also has a rich history of dividend payments, implying investors could continue to benefit from higher dividend payments. 

Kinross Gold

Kinross Gold (TSX:K)(NYSE:KGC) is too cheap to ignore at current price levels. Its NTM EV/EBITDA multiple of 3.7 compares favourably to its peer group average as well as its historical average. Notably, gold prices have trended lower in the recent past pressurizing shares of gold mining companies, including Kinross Gold. Despite near-term headwinds, I maintain a bullish outlook on Kinross Gold stock.

I expect Kinross Gold to benefit from growing production and cost reduction. Meanwhile, its strong balance sheet and robust free cash flows indicate that Kinross Gold could continue to boost shareholders’ returns through dividend payments and share repurchases.

Enbridge

Let’s wrap up with Enbridge (TSX:ENB)(NYSE:ENB) stock, which is trading at NTM EV/EBITDA and P/E multiple of 12.2 and 16.8, respectively. Its forward valuation multiples are still lower than the historical average, indicating further upside in its stock. Further, the recovery in its mainline volumes amid improving energy demand positions it well to deliver superior returns. 

Enbridge’s diversified assets, contractual arrangements, momentum in the core business, and strong secured capital program indicate that Enbridge could continue to deliver robust cash flows. Meanwhile, Enbridge’s long dividend payment history and stellar yield of 6.6% make it attractive income stock trading at a lower valuation. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Enbridge. The Motley Fool recommends Absolute Software Corporation and BANK OF NOVA SCOTIA.

More on Dividend Stocks

Train cars pass over trestle bridge in the mountains
Dividend Stocks

Is CNR Stock a Buy, Sell, or Hold for 2025?

Can CNR stock continue its long-term outperformance into 2025 and beyond? Let's explore whether now is a good time to…

Read more »

coins jump into piggy bank
Dividend Stocks

The Smartest Dividend Stocks to Buy With $500 Right Now

These top dividend stocks both offer attractive yields and trade off their highs, making them two of the best to…

Read more »

Middle aged man drinks coffee
Dividend Stocks

Here’s the Average TFSA Balance at Age 35 in Canada

At age 35, it might not seem like you need to be thinking about your future cash flow. But ideally,…

Read more »

ETF stands for Exchange Traded Fund
Dividend Stocks

How to Invest Your $7,000 TFSA Contribution in 2024

Here's how I would prioritize a $7,000 TFSA contribution for growth and income.

Read more »

a man relaxes with his feet on a pile of books
Dividend Stocks

CPP Pensioners: Watch for These Important Updates

The CPP is an excellent tool for retirees, but be sure to stay on top of important updates like these.

Read more »

Technology
Dividend Stocks

TFSA Investors: 3 Dividend Stocks I’d Buy and Hold Forever

These TSX dividend stocks are likely to help TFSA investors earn steady and growing passive income for decades.

Read more »

four people hold happy emoji masks
Dividend Stocks

Love Dividend Growth? Check Out These 2 Income-Boosting Stocks

National Bank of Canada (TSX:NA) and another Canadian dividend-growth stock are looking like a bargain going into December 2024.

Read more »

An investor uses a tablet
Dividend Stocks

A Dividend Giant I’d Buy Over Enbridge Stock Right Now

Enbridge stock may seem like the best of the best in terms of dividends, but honestly this one is far…

Read more »