Written by Amy Legate-Wolfe at The Motley Fool Canada
In the world of finance, the allure of cheap stocks is undeniable. Investors often find themselves drawn to stocks that trade at lower prices, hoping for a turnaround that will deliver significant returns. In this article, we’ll explore three Canadian stocks trading under $10 each that have the potential for a bright future based on their recent earnings and growth prospects.
Well Health stock
Well Health Technologies (TSX:WELL), a leading player in the healthcare tech sector, experienced a rollercoaster ride in its share price. It soared, only to experience a downturn. Let’s delve deeper into why this stock is worth considering.
Hamed Shahbazi, founder and chief executive officer of WELL, remarked on the company’s impressive performance: “We had a great quarter; our record revenue, adjusted EBITDA [earnings before interest, taxes, depreciation, and amortization], and patient visits are a testament to the company’s continued focus on tech-enabling healthcare providers.” With over 3,200 providers and clinicians and more than one million quarterly patient visits, WELL stock has demonstrated exceptional growth.
Furthermore, WELL stock is venturing into the realm of artificial intelligence (AI) with initiatives like WELL AI Voice and the WELL AI Investment Program. These investments in AI-enabled disease detection and clinical decision support tools are set to revolutionize healthcare practices, improve clinic productivity, and enhance patient outcomes.
The future looks bright for WELL stock, making it an attractive option for patient investors looking to capitalize on the convergence of technology and healthcare.
NorthWest Healthcare Properties REIT (TSX:NWH.UN) experienced a surge in share price followed by a dip. But there’s more to the story. This healthcare real estate investment trust (REIT) has promising fundamentals.
For the three and six months ending in June 2023, the REIT witnessed impressive revenue growth of 13% and 16.6%, respectively. While adjusted funds from operations (AFFO) per unit decreased slightly due to lower management fees and increased interest expenses, when adjusting for non-recurring components, AFFO increased to $0.15 per unit for the quarter.
Operationally, the REIT boasts a high-quality and defensive portfolio, delivering a robust 5.1% year-over-year same-property net operating income growth. With a portfolio occupancy rate of 96% and a weighted average lease expiry of 13.5 years, NorthWest Healthcare Properties REIT’s cash flow is diversified across its 231 properties.
With these strong fundamentals and a resilient portfolio, NorthWest Healthcare Properties REIT presents an attractive opportunity for investors looking for stability and growth in the healthcare real estate sector.
Extendicare (TSX:EXE), a prominent player in the senior living sector, also had its share of ups and downs in the stock market. However, a closer look at its recent earnings reveals a promising outlook for patient investors.
In the second quarter (Q2) of 2023, Extendicare experienced a 4.1% increase in average daily volume (ADV) for home health care, building on its ongoing growth. Long-term-care (LTC) occupancy improved to 97.2%, demonstrating a strong recovery.
While adjusted EBITDA declined slightly due to one-time items in Q2 2022, removing these items showed an increase of $1.2 million. This growth was driven by higher home health care ADV and rate increases, offsetting cost increases in LTC operations and higher administrative costs.
Moreover, Extendicare is investing in the future with the construction of a new 256-bed LTC home in Peterborough, Ontario, signalling its commitment to expanding and enhancing its services.
Extendicare is well positioned to deliver significant returns for patient investors — especially with the aging population and increasing demand for senior living solutions.
Cheap stocks can offer an enticing opportunity for investors seeking growth potential. These three Canadian stocks experienced fluctuations in share prices. Yet their recent earnings and growth prospects suggest that they are worth considering.
As always, it’s essential to conduct thorough research before making any investment decisions. However, these three Canadian stocks under $10 each are certainly worth a closer look in today’s dynamic market.
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Fool contributor Amy Legate-Wolfe has positions in NorthWest Healthcare Properties Real Estate Investment Trust and Well Health Technologies. The Motley Fool recommends NorthWest Healthcare Properties Real Estate Investment Trust. The Motley Fool has a disclosure policy.