Investor apathy in Canada leads to low valuations, creating buying opportunities in the market.

From Nasdaq: 2024-07-08 10:21:00

In a podcast, Motley Fool host Dylan Lewis and analyst Jim Gillies discuss the TSX performance compared to the S&P 500 in 2024. Investor apathy in Canada has led to low valuations and buying opportunities. Two Canadian stocks to watch: MTY Food Group and Kits Eyecare. For full episodes of The Motley Fool podcasts, visit the podcast center for investing guidance and stock picks.

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Year-to-date, the Canadian market is up 4.5%, with a total return of over 6% compared to the S&P 500’s 14.5% gain. The TSX’s performance is somewhat apathetic despite dividends boosting total returns. The American market’s narrow focus on top companies, excluding Tesla, has led to concentrated returns, while the TSX is undervalued with companies trading at significant discounts.

Investors can find Canadian companies trading at substantial discounts on earnings multiples and 10-year relative valuations. Real Estate Investment Trusts offer high yields of 7-9%, with some CEOs buying units. Canadian banks, a classic widows and orphans stock, have a strong track record of dividend growth, despite a temporary halt during COVID. The top 10 largest Canadian companies by market cap include three banks, highlighting their dominance and stability.



Read more at Nasdaq: Canada’s Stock Market: Apathy Means Opportunity