Value is back, and in a big way, following last week’s bit of market turbulence, which saw some of the high-tech innovators be sent straight to the penalty box for reasons mostly outside their control. Undoubtedly, tech, which has been in for quite some time, is starting to fall out of fashion. I have no idea (nor does anybody else who claims to be on Wall or Bay Street!) if the recent tech volatility is just the start of an ugly downward move or if this is just another blip that can be bought with both hands! Either way, if you’re a young , it’s hard not to be drawn back to the value names out there, many of which are hiding in plain sight on the TSX Index and S&P 500.
In this piece, we’ll consider two Canadian value picks that I’d be willing to bet on for the next 18 months. Spin Master ( ) is a toymaker that’s starting to enter deep-value territory following its latest move below the $30 per-share level. Indeed, the discretionary retail scene has been a horrible place to be of late.
But the times could change meaningfully as soon as the fourth quarter of 2024. Indeed, the holiday season is a huge deal for the toy industry. And with an impressive showcase and marketing in place, perhaps TOY stock could be closer to a bottom than most would think.
Indeed, the stock chart is not pretty right now, with shares down more than 12% year to date and north of 15% in the past year. That said, I find the multiple to 10.3 times forward price to earnings (P/E) to be extremel.
