Value stocks

Top 3 Canadian Value Stocks for September 2021

Written by Joey Frenette at The Motley Fool Canada

September is approaching and instead of a much-anticipated correction, we might expect a continued upside as more and more investors finally put their money to work in the remaining bargains. In this article, we’ll take a look at three Canadian stocks that have already suffered steep declines and are in a position to make up for lost time as the fall season approaches.

Canadian Value Stocks for Sale

Without further ado, consider Badger Infrastructure Solutions (TSX: BDGI), Cineplex (TSX: CGX), and Suncor Energy (TSX:SU)(NYSE:SU): Three unloved names that seem too cheap for their own good heading into September 2021.

Badger Infrastructure Solutions

Badger Infrastructure Solutions, formerly known as Badger Daylighting, has had a disappointing year as the stock has now corrected nearly 30% following less than stellar earnings results. The margins did not go in the direction Badger had hoped. The pressures of COVID-19 continue to weigh on and the soil digger doesn’t seem to be taking a break.

Today, the Canadian stock is just a few percentage points off its 52-week low. I think the contrarians need to buy, because the company has a lot of room to catch up in the second half. The environment seems more favorable and the recent quarterly worries could turn out to be more temporary.

As infrastructure spending rises in the early innings of the economic expansion, I think it will be difficult to keep Badger down. The mobile soil excavation business is a dirty business, but someone has to do it! The stock trades at 2.3 times sales and is one of the best mid-cap bargains on the TSX these days. If you can handle the volatility, I think the risk/reward trade-off is absolutely terrific in September 2021.

Cineplex

Cineplex has been under considerable pressure for nearly five years now. It’s been a hell of a fall from grace, but I think the wind is about to pick up. Anything bad that could have happened to the darling movie and entertainment company has pretty much already happened. A pandemic is pretty much the worst exogenous event that could have happened!

With more vaccines coming into the guns, I believe the COVID-19 pandemic is well positioned to become endemic. Although the coronavirus will not be eradicated for years or even decades, I believe that it will be more manageable in such a way that a return to normality is not compromised.

What does this mean for Cineplex shares?

I think the bottom is in place. With its new CinePass subscription service offering an incredible value proposition to moviegoers, I think investors are heavily downplaying the company’s long-term recovery prospects.

Suncor Energy

Finally, we have Suncor Energy, a quality integrated energy company that is not respected these days.

The longer oil stays high, the more room the company will have and the higher its dividend and stock price will be. With the widening valuation gap between Suncor stock and its peers, I think strong-stomached naysayers have a lot to gain from Suncor’s risk/reward trade-off here. The Canadian stock is trading at a slight discount to its book value and is well-equipped to surpass its 2020 highs again, perhaps within the next 18 months.

Investing in oil can be difficult. But if you’re looking for deep value, Suncor is one of the best horses to bet on these days.

The post 3 Top Canadian Value Stocks for September 2021 appeared first on The Motley Fool Canada.

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Fool contributor Joey Frenette has no position in any of the stocks mentioned. The Motley Fool recommends CINEPLEX INC.

2021