2 Cheap Canadian Stocks to Buy for a Year-End Rally

If you’re looking for a cheap Canadian stock to buy now, here are three of the biggest discounts to take advantage of today.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

With stock markets continuing to set new all-time highs, only a handful of Canadian stocks are trading cheap enough that value investors would consider a buy today. And because these stocks could offer so much potential, and may even see a significant rally to end the year, now is the time to take advantage.

Of course, we all want to buy stocks as cheaply as possible. But these stocks are only worth an investment if they are of high quality, and we believe they’ll continue to appreciate back to their fair value over time.

So if you’re looking for a high-potential stock or two that you can buy while it’s cheap, here are two of the best Canadian stocks to consider today.

A top Canadian gold stock trading at a major bargain

Several gold stocks offer investors attractive opportunities today. One of the top Canadian gold stocks to buy while it’s cheap, though, is B2Gold (TSX:BTO)(NYSEMKT:BTG).

Not only is it cheap relative to current gold prices, but gold prices could also continue to climb as the dollar weakens with all this inflation. So B2Gold is an excellent investment to consider today.

The company is one of the lowest cost producers to buy and has been expanding its operations for over a decade now. This has led to impressive profitability from B2Gold, and at these gold prices, it can earn a tonne of cash flow. So with the Canadian stock down by almost 40% over the last 12 months, despite gold prices being down just 6%, it’s incredibly cheap and one of the best to buy now.

Currently, B2Gold trades at a forward enterprise value to EBITDA ratio of just 3.3 times. Furthermore, it has a forward price-to-earnings ratio of just 9.0 times. Both are exceptionally cheap.

The stock even pays an attractive dividend to investors since it earns so much free cash flow. Currently, that dividend yields roughly 3.8%.

While almost all gold stocks are undervalued, in my opinion, B2Gold has one of the biggest discounts, especially when you consider its quality. I’d buy it soon, though. These stocks have finally started to gain some momentum. Since B2Gold bottomed on September 29, it’s already up by more than 28%.

Plus, the average target price from analysts is $8.30, a more than 50% premium to today’s price. So if you’re looking to buy a high-quality Canadian stock that’s cheap, I’d look to buy B2Gold as soon as possible.

A top Canadian media stock to buy while its cheap

Another Canadian stock that continues to trade at a massive bargain is Corus Entertainment (TSX:CJR.B). If you thought B2Gold was cheap and worth a buy, just wait until you see the Canadian media stock’s valuation.

Corus trades incredibly cheaply at a forward price to earnings ratio of just 6.2 times. Its forward enterprise value to EBITDA ratio is slightly higher than B2Gold’s at 5.1 times. However, that’s still a relatively cheap valuation. Furthermore, it’s mostly due to Corus having a significant debt load while B2Gold has a $500 million net cash position.

In addition, Corus has been paying down a significant portion of its debt for several quarters now, including throughout the pandemic. So the company continues to improve its position and earn a tonne of cash flow, yet the stock hasn’t budged since March.

Analysts think it could be worth as much as $10 a share in the next 12 months, with the lowest estimate being $8.40. That’s a 50% premium to today’s price.

This makes the Canadian stock one of the best to buy now, and not just because it’s cheap. Corus also pays a dividend that currently yields 4.3%. So you can be patient while you collect the dividend and wait for Corus to rally back to its fair value.

Should you invest $1,000 in B2gold Corp. right now?

Before you buy stock in B2gold Corp., consider this:

The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and B2gold Corp. wasn’t one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $21,345.77!*

Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 24 percentage points since 2013*.

See the Top Stocks * Returns as of 4/21/25

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 Daniel Da Costa owns shares of B2GOLD CORP. and CORUS ENTERTAINMENT INC., CL.B, NV. The Motley Fool has no position in any of the stocks mentioned.

Confidently Navigate Market Volatility: Claim Your Free Report!

Feeling uneasy about the ups and downs of the stock market lately? You’re not alone. At The Motley Fool Canada, we get it — and we’re here to help. We’ve crafted an essential guide designed to help you through these uncertain times: "5-Step Checklist: How to Prepare Your Portfolio for Volatility."

Don't miss out on this opportunity for peace of mind. Just click below to learn how to receive your complimentary report today!

Get Our Free Report Today

More on Stocks for Beginners

ETF stands for Exchange Traded Fund
Dividend Stocks

The Best Canadian ETFs $1,000 Can Buy on the TSX Today

If you're looking for ETFs that can turn $1,000 into strong cash flow, then these are the ones I'd go…

Read more »

dividend growth for passive income
Dividend Stocks

4 Canadian Dividend Stocks to Buy and Hold for the Next 20 Years

These dividend stocks can certainly stand the test of time, and have already done so for many investors.

Read more »

A woman shops in a grocery store while pushing a stroller with a child
Dividend Stocks

1 Practically Perfect Canadian Stock at All-Time Highs to Buy Now and Hold for a Lifetime

This top Canadian stock owns many of the brands Canadians use every day, checking all the essential boxes.

Read more »

analyze data
Stocks for Beginners

The Best Canadian Stocks to Buy Right Away With $30,000

These three top Canadian stocks have one thing in common: stability. Let's get into why.

Read more »

Stocks for Beginners

1 Magnificent Canadian Stock Down 37% to Buy and Hold Forever

The Canadian stock we're discussing may not seem essential, but parents would argue otherwise.

Read more »

Piggy bank with word TFSA for tax-free savings accounts.
Dividend Stocks

How I’d Structure My TFSA With $14,000 for Almost Constant Monthly Income

These four choices could make any $14,000 investment a strong one, especially with solid dividends that will stand the test…

Read more »

Muscles Drawn On Black board
Dividend Stocks

The Best Canadian Stocks to Buy Right Away With $4,000

Seeking strength from your investments? Then these are the three stocks to consider first.

Read more »

A airplane sits on a runway.
Stocks for Beginners

Where Will Bombardier Stock Be in 5 Years?

Bombardier stock has made such an amazing turnaround that it has investors wondering: what's next?

Read more »