Last Updated: August 1, 2026
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These 5 TSX stocks are trading below their highs but still posting strong earnings. Here’s what the numbers actually say—and how Canadian investors can decide whether they’re worth buying.
My cousin Adaeze texted me in August: “Should I buy Shopify? Everyone’s saying it’s cheap.” I asked her what “cheap” meant to her. She didn’t know. She’d seen a headline, not a balance sheet.
That conversation is basically why this article exists. “Cheap” gets thrown around a lot in Canadian investing content, and it’s usually shorthand for “the stock went down recently,” not “this business is actually undervalued.” Those are two very different things, and mixing them up is how people lose money buying “dips” that keep dipping.
So instead of just repeating the popular list of five TSX names investors keep circling this summer, I pulled the actual quarterly numbers, checked what’s driving each stock’s pullback, and I’m giving it to you straight — including where I think the “cheap” label doesn’t quite hold up.
“Cheap” and “Undervalued” Aren’t the Same Thing
Picture walking into a store during a clearance sale and finding a premium winter coat marked down 50%. You wouldn’t assume the coat suddenly became worthless — you’d assume you found a bargain. But you’d also check the stitching before buying, because sometimes things are on sale precisely because something’s wrong with them.
Stocks work the same way. A falling share price doesn’t automatically mean a company got cheaper in the way that matters. Sometimes a business is genuinely being mispriced because of sentiment, sector-wide fear, or a one-off event like a share offering. Other times, the price dropped because the business itself is deteriorating — and no discount fixes that.
Warren Buffett summed up the distinction in seven words: “Price is what you pay. Value is what you get.” That’s really the filter every stock in this article needs to pass through.
Quick Answer: The 5 Stocks (At a Glance)
| Stock | Ticker | Sector | Why It’s Down | Is It Actually Cheap? |
|---|---|---|---|---|
| Shopify | TSX:SHOP | E-commerce tech | AI disruption fears, valuation reset | Debatable — down ~25% YTD but still growing revenue 34% |
| Stantec | TSX:STN | Engineering/consulting | Broad tech-sector selloff, growth-stock caution | Yes — record backlog, down despite strong Q1 |
| MDA Space | TSX:MDA | Aerospace/satellite | Dilution from CLS acquisition, share offering | Yes — company-specific, not fundamental weakness |
| Cameco | TSX:CCO | Uranium/nuclear fuel | Uranium price swings | No — currently trading near 52-week highs |
| Dollarama | TSX:DOL | Discount retail | Minor pullback from all-time high | No — still trades at a premium valuation |
Let’s break down what’s actually happening with each one.
1. Shopify (TSX:SHOP) — The One Everyone’s Arguing About
Shopify is the stock that splits a dinner table. One camp says it’s a battle-tested Canadian tech champion having a normal pullback. The other says the AI-disruption fears are legitimate and the stock was priced for perfection that isn’t showing up anymore. (If you’re curious what the platform itself actually does for merchants before you invest in the stock, you can check out Shopify here.)
Here’s what’s true either way: the company posted Q1 2026 revenue of $3.17 billion, up 34% year over year, with gross merchandise volume of $100.7 billion and free cash flow of $476 million at a 15% margin. That’s not a company in trouble — that’s a company growing fast and generating real cash while the stock trades meaningfully off its highs.
What’s actually weighing on the share price isn’t a bad quarter. It’s a mix of macro nervousness and a genuine, still-unresolved question the market is wrestling with: does AI shopping agents and “agentic commerce” ultimately help Shopify (more transactions flowing through its rails) or squeeze it (merchants disintermediated by AI shopping assistants)? A shareholder proposal asking the company to adopt a formal AI policy only drew about 14% support at the June 2026 annual meeting — a sign the board isn’t treating this as an emergency, but not everyone in the market agrees.
My honest take: Shopify isn’t “cheap” in the deep-value sense — it still trades at a growth-stock multiple. But if you believe Canadian e-commerce infrastructure has a decade-long runway, buying a wobble instead of a euphoria high is usually the smarter entry point.
Real-life example: Think of it like buying a rental property in a neighbourhood that just had one noisy news cycle about crime rates. The rents haven’t dropped, the tenants haven’t left, but the price softened because sentiment did. That gap between sentiment and fundamentals is exactly where patient investors try to operate.
2. Stantec (TSX:STN) — The Quiet Infrastructure Compounder
Stantec is the stock nobody brags about at parties, and that’s kind of the point. It’s an engineering and environmental consulting firm working on water systems, transportation, hospitals, and data centres — unglamorous, recession-resistant, government-funded work.
In Q1 2026, Stantec reported net revenue of $1.7 billion, up 9.1% year over year, with adjusted EBITDA rising 13.8% to $287 million and adjusted EPS climbing 14.7% to $1.33. Contract backlog hit a record $9.0 billion, up 13.2% from a year earlier. Translation: the company has almost a full year of confirmed future work already lined up, and it’s growing.
And yet the share price fell 11% in a single week, was down nearly 15% over the past month, and roughly 24% over the past year at one point this year. That’s the disconnect that makes value investors sit up: record operational results, falling stock price. That combination usually means the market is punishing the whole sector (tech-adjacent consulting names got lumped in with AI-disruption worries) rather than punishing Stantec specifically.
Real-life example: Picture a contractor who just landed 13 months of confirmed bookings but whose stock price acts like she just lost her biggest client. That gap is either a mispricing or a warning — and here, the backlog numbers say mispricing.
3. MDA Space (TSX:MDA) — Growth Story, Temporary Headache
MDA Space is Canada’s clearest pure-play on the commercial space economy — satellites, robotics, and Earth-observation geointelligence. The stock dropped hard recently, but the reason is almost entirely mechanical, not fundamental.
MDA Space agreed to acquire a 70% stake in France-based CLS for approximately C$920 million to expand its Earth-observation and geointelligence business. To help pay for it, the company completed a bought-deal share offering of 23 million shares at US$35.60, raising roughly US$819 million, with the stock trading below the offering price after declining about 20% in a week.
That’s dilution doing what dilution does — more shares outstanding, temporary price pressure — not the market losing confidence in the business itself. And the acquisition itself looks accretive: CLS serves over 14,000 customers across roughly 150 countries and is expected to generate about C$465 million in 2026 revenue, growing around 22% annually since 2023, with margins in line with MDA’s own 18–20% target and expected to double MDA’s recurring revenue base.
My honest take: This is closer to true “buy the dip” territory than Shopify is, because the drop has an identifiable, temporary cause (a stock offering) layered on top of a growth story that’s arguably stronger after the deal than before it.
4. Cameco (TSX:CCO) — Where I Push Back on the “Cheap” Label
I want to be straight with you here: by the time you’re reading this, Cameco may not be the bargain the headlines suggest. Over the past year the stock surged roughly 140%, largely on rising uranium prices and renewed nuclear-policy support, and recent data has it trading close to multi-year highs, not deep in a discount.
That doesn’t mean the long-term uranium story is wrong. Spot uranium prices ended 2025 around $82 a pound, with long-term contract prices approaching $100 a pound — levels not consistently seen since 2007 — while utilities remain significantly under-contracted, which points to more buying pressure from utilities ahead. Cameco’s disciplined contracting strategy uses market-related contracts with floors in the high $70s and ceilings around $160, capturing upside while protecting the downside.
My honest take: Cameco is a phenomenal long-term nuclear-power thesis. It is not, right now, the screaming discount some “cheap stocks” roundups make it out to be. If you’re buying it, buy it for the 2030+ nuclear buildout story, not because you think you’re getting it on sale this week.
5. Dollarama (TSX:DOL) — Steady, But Priced Like It
Dollarama is the ultimate “boring wins” stock — a discount retailer that does well whether the economy is booming or people are pinching pennies. The stock trades around a price-to-earnings ratio in the high 30s to nearly 40 times earnings, and it hit an all-time high in early 2026 before pulling back roughly 15% from that peak. Analyst price targets from BMO, Desjardins, and UBS still range from about C$196 to C$215, which suggests Bay Street sees room to run, even if the stock isn’t cheap by any traditional valuation measure.
Real-life example: Think of it like buying a well-run apartment building in the best part of town. You’re not getting a discount on the building — everyone knows it’s good — but you’re paying for reliability, not hoping for a turnaround.
My honest take: Own Dollarama for stability and a growing dividend, not because you’re catching a value stock. It has still delivered roughly 476% in capital gains over the past decade, an annualized return near 19%, which is the kind of quiet compounding that rarely makes headlines but builds real wealth.
So… Which of These Are Actually “Cheap”?
Honestly, only two of the five — Stantec and MDA Space — show the classic pattern of strong fundamentals paired with a price drop driven by something other than the business itself. Shopify sits in the middle: real growth, but still priced for a lot of future success. Cameco and Dollarama are excellent businesses that simply aren’t discounted right now, whatever a headline says.
That’s not a knock on any of them — it’s the difference between a “buy this business for the long term” stock and a genuine “the market mispriced this” opportunity. Both are valid strategies. Just know which one you’re actually doing.
Which Stock Fits Your Investing Style?
Not every stock on this list suits every investor, and you don’t need to own all five to build a solid position.
| Investor Type | Stocks That Fit Best |
|---|---|
| Growth-focused | Shopify, MDA Space |
| Defensive / lower-volatility | Dollarama, Stantec |
| Sector/thematic (energy transition) | Cameco |
| Long-term, diversified | A mix across sectors rather than one name |
Spreading a position across a few of these instead of going all-in on one reduces how much a single bad quarter can hurt your portfolio.
A Quick Lesson From Market History
It’s worth remembering that plenty of the world’s biggest companies spent years being underestimated before the market caught on. Apple traded at modest multiples for years before the iPhone changed everything. Nvidia was a niche graphics-chip maker long before it became the face of the AI buildout. Closer to home, Canadian National Railway rewarded patient shareholders for decades through unglamorous, disciplined growth — no viral headlines required.
None of that guarantees any of the five stocks above becomes the next breakout story. But it’s a reminder that the market frequently misprices “boring” or “controversial” businesses in both directions, and the investors who do well tend to be the ones judging the business, not the headline.
How to Actually Buy These Stocks From Canada
Knowing the stocks is only half the job. Here’s how Canadian investors typically get exposure:
- Open a self-directed brokerage account. Wealthsimple Trade is one of the most popular commission-free-friendly options for Canadians buying individual TSX stocks like these — you can get started here.
- Use a TFSA or RRSP where possible. Growth and dividends inside these accounts are sheltered from tax, which matters a lot on a stock like Dollarama that’s compounded nearly 20% annually.
- Consider dollar-cost averaging into volatile names like Shopify or MDA Space rather than trying to time the exact bottom — nobody consistently nails that, professionals included.
- Set a position-size rule before you buy, not after. Something as simple as “no single stock is more than 10% of my portfolio” saves a lot of regret.
Before you buy any individual stock, run through this quick checklist:
- Read the company’s most recent quarterly report, not just a headline about it
- Understand how the business actually makes money
- Compare its valuation (P/E, growth rate) against direct competitors
- Only invest money you won’t need in the next few years
- Make sure this stock is one piece of a diversified portfolio, not the whole thing
FAQ
Are these stocks good for beginners? Shopify and Dollarama are large, liquid, well-covered names that are reasonable starting points. MDA Space and Cameco carry more sector-specific risk (space contracts, commodity prices) and suit investors comfortable with volatility.
Is now really a good time to buy Canadian stocks? There’s no universal “good time” — it depends on your time horizon and each company’s fundamentals, which is exactly why this article breaks each one down individually instead of treating “cheap TSX stocks” as one basket.
Do I need a lot of money to start investing in TSX stocks? No. Most Canadian discount brokerages allow fractional or single-share purchases, so you can start with whatever amount fits your budget.
Are cheap stocks always good investments? No, and that’s the whole point of this article. Some stocks are inexpensive because the underlying business is genuinely struggling. Cheap only becomes a good investment when it’s paired with solid fundamentals — which is why Stantec and MDA Space made a stronger case here than Cameco or Dollarama did.
Should beginners buy individual stocks, or start with an index fund? Many new investors are better served starting with a broad-market ETF or index fund for the bulk of their portfolio, then adding individual stocks like the ones above once they’re comfortable researching companies on their own.
Is uranium/Cameco a good long-term hold even at current prices? The long-term nuclear demand story remains strong, but paying near multi-year highs means your margin of safety is thinner than it would be on a genuine pullback — size your position accordingly.
The Bottom Line
“Cheap” is a word that deserves receipts, not just a headline. Stantec and MDA Space currently back up the label with real numbers. Shopify is a strong business at a fair-to-full price. Cameco and Dollarama are excellent companies you’d buy for quality and compounding, not for a discount.
Adaeze ended up buying a small starter position in Shopify inside her TFSA — not because it was “cheap,” but because she finally understood why the price moved before she clicked buy. That’s really the only edge most of us can consistently have.
