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Canadian stocks are often considered a bargain because they combine the best of both worlds: strong fundamentals and attractive valuations. While the Canadian market is rich in natural resources, financial services and, increasingly, technology, these stocks typically trade at a lower price-to-earnings ratio compared to their U.S. counterparts.
This means that investors can buy quality companies at a discount, while benefiting from solid dividends and the stability of a well-regulated market. Plus, because the Canadian dollar typically trades at a lower value than the US dollar, international investors can find even more value by converting their earnings to their local currency. So let's look at some stocks that Canadians should consider at a low price.
Northwest REIT
NorthWest Healthcare Property REIT (TSX:NWH.UN) looks like a bargain for income-focused investors, especially with its high dividend yield. The stock currently offers a forward annual dividend yield of over 7.1%, which is quite attractive in today's market. Despite challenges in the real estate sector and a significant drop in its share price over the past year, this real estate investment trust (REIT) continues to pay a solid dividend. The combination of a lower share price and solid dividend yield may make NWH.UN a value play, especially for investors who believe in the long-term stability of healthcare properties.
What makes NWH.UN particularly interesting is that its shares are trading below their book value. This means that investors are essentially getting a discount on the company’s assets. Coupled with the fact that the healthcare real estate sector tends to be more recession-resistant, this adds an extra layer of security for those looking to invest in a sector with stable demand. While there are risks, such as the high payout ratio and significant debt, the current valuation suggests that the market may be underestimating the long-term potential of this REIT.
Crombie Real Estate Investment Trust
Crombie Real Estate Investment Trust (TSX:CRR.UN) also looks like a bargain for investors who love reliable income, particularly given its juicy dividend yield. Currently, with a forward annual dividend yield of just over 6%, Crombie provides a steady stream of income. With a strong track record of consistent dividend payments and a payout ratio that suggests sustainability, CRR.UN stands out as a solid choice for those looking to add some income-focused stability to their portfolio.
However, what makes Crombie even more attractive is that it is trading at a reasonable price relative to its book value, suggesting that investors are getting good value for their money. Despite the challenges in the broader market, Crombie has managed to maintain solid profitability and cash flow. And this supports its dividend payments. With the stock trading near its 52-week highs but still offering a yield that is hard to ignore, CRR.UN presents itself as an attractive bargain for those who want to invest in a reliable, income-generating Canadian stock.
Sienna
Senior residence in Sienna (TSX:SIA) is at bargain prices for those looking for a stable dividend in the healthcare sector. With a forward annual dividend yield of just 6%, SIA offers an attractive income stream, especially for investors looking for reliable returns. Despite operating in a challenging environment, SIA has managed to maintain its dividend. This speaks to the resilience of its business model focused on residential and senior care. The consistent payout, combined with the company’s strong quarterly earnings growth of over 36% year-over-year, suggests that SIA is well positioned to continue rewarding its shareholders.
Furthermore, SIA’s share price has seen a significant increase over the past year, but it still trades at a reasonable valuation, making it a potentially undervalued gem in the market. The company’s ability to generate consistent cash flow, coupled with its commitment to returning value to shareholders through dividends, makes it an attractive option for those looking to invest in a stable, income-generating Canadian stock. Despite the high payout ratio, SIA’s strong financials and the essential nature of its services provide confidence that its dividends can remain robust. This makes it an attractive option for dividend-focused investors.