In this article, we will look at the 10 Most Oversold Canadian Stocks to Invest In.
Canadian stocks have been on a roll, rallying to record highs and outperforming their US counterparts. The country’s main stock index, the Toronto Stock Exchange Composite Index, gained 29% in 2025, outpacing the S&P 500, which rose 16%. The outperformance has continued, with the TSX gaining 8% compared to the S&P 500’s 4% over the same period.
The stock market has delivered three consecutive years of gains. The outperformance stems from the Canadian equity market’s heavy concentration in energy and basic materials stocks, which have benefited from a spike in commodity prices.
“The materials sector benefited from rising prices in gold, copper, and other critical minerals, as investors sought hedges against geopolitical and inflation risks,” says Ashish Dewan, investment strategist at Vanguard Canada. Analysts expect this trend to continue into 2026.
Canada’s stock market looks set to keep rising. Contributing factors include low interest rates, strong consumer spending, and the possible resolution of the tariff conflict with the US.
“While no market leads forever, the Canadian stock market enters 2026 with meaningful tailwinds and a more balanced foundation than the US … the case for continued relative strength is very much alive,” says Desjardins Capital Markets macro strategist Tiago Figueiredo.
While valuations have risen significantly as the broader equity market powers to record highs, there is still room for further gains, especially in stocks that have come under pressure. Some Canadian stocks have pulled back sharply and entered oversold territory amid a decline in commodity prices.
“The strongest tailwind for Canadian equities is that they are part of value-oriented global equities. Canada’s stock market should benefit as artificial intelligence adoption broadens. Efficiency will improve across industries as AI is adopted by more consumers, not just technology builders,” says Ashish Dewan, investment strategist at Vanguard Canada.
With that in mind, let’s take a look at the most oversold Canadian stocks to invest in.
Our Methodology
For our list of the most oversold mid-cap stocks to buy, we selected Canadian stocks with the lowest Relative Strength Index (RSI) readings and an average analyst rating of Buy or better. We used the Finviz screener to identify stocks with an RSI below 35. We further trimmed the list to stocks with upside potential of more than 5% and detailed the number of hedge funds holding stakes in them in Q4 2025. Finally, we ranked the stocks based on their upside potential (as of May 4).
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research shows we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
Most Oversold Canadian Stocks to Invest In
10. Allied Gold Corporation (NYSE:AAUC)
Relative Strength Index Reading: 22.27
Stock Upside Potential: 10.46%
Number of Hedge Fund Holders: 11
Allied Gold Corp (NYSE: AAUC) is one of the most Oversold Canadian stocks to invest in. On April 1, Allied Gold Corp shareholders approved a proposed acquisition of the company by Zijin Gold.
The Hong Kong listed company has agreed to acquire Allied Gold in a transaction that values the company at C$44 a share. The all-cash transaction values the company at an equity value of C$5.5 billion and comes with no financing conditions. Zijin is to acquire the company using cash on hand, with the transaction poised to close by the end of May.
According to Chairman and Chief Executive Peter Marrone, the transaction will provide a highly attractive all-cash offer for the company. It also represents an all-time high for the share price. The planned acquisition comes when Allied Gold Corp’s core asset, including Sadiola, the Côte d’Ivoire complex, and Kurmuk are poised to begin production this year. The mines produce about 375,000 ounces of gold a year.
Allied Gold Corporation is an international gold mining company focused on exploring, developing, and operating gold mining assets in Africa, specifically in Mali, Côte d’Ivoire, and Ethiopia. Headquartered in Toronto, Canada, the company operates high-quality mines like Sadiola (Mali) and the CDI complex (Côte d’Ivoire) using open-pit and underground techniques, with a goal to become a senior producer aiming for over 700-800koz of annual gold production.
9. CGI Inc. (NYSE:GIB)
Relative Strength Index Reading: 33.56
Stock Upside Potential: 25.88%
Number of Hedge Fund Holders: 22
CGI Inc. (NYSE:GIB) is one of the most oversold Canadian stocks to invest in. On April 30, CGI Inc. inked a strategic partnership with Cleura to expand its sovereign cloud offering in the Nordics. The partnership comes as the company looks to capitalize on growing cloud demand from Nordic organizations.
As part of the partnership, CGI is to integrate Cleura’s European-based cloud services into its offerings. The integration will allow the company to further strengthen its position as a trusted partner in cloud data and hybrid IT. It will also allow the company to support clients as they navigate the complex digital landscape.
On the other hand, CGI has achieved the Microsoft Copilot specialization in Modern Work within its Microsoft AI Cloud Partner Program. The designation paves the way for the company to deliver Microsoft 365 Copilot solutions and its capabilities. The designation will allow the company to operationalize cloud and AI investments securely at scale while navigating cybersecurity challenges.
CGI Inc. is one of the world’s largest independent IT and business consulting firms, providing end-to-end services including strategic IT consulting, systems integration, and managed services. It helps clients—particularly in government, financial services, and healthcare—digitally transform, improve operational efficiency, and implement technology solutions.
8. Lululemon Athletica Inc. (NASDAQ:LULU)
Relative Strength Index Reading: 29.39
Stock Upside Potential: 33.61%
Number of Hedge Fund Holders: 78
Lululemon Athletica Inc. (NASDAQ:LULU) is one of the most oversold Canadian stocks to invest in. On April 29, Lululemon Athletica Inc. founder Chip Wilson reiterated his opposition to the appointment of former Nike executive Heidi O’Neill as the company’s next chief executive officer.
According to the founder, who owns 8.6% of the company, the board lacks the skillset to hire a world-class brand and product person who can deliver on current brands. Wilson also insists the next CEO should be in a position to lead the company in attracting talent and executing a turnaround. Elliott Investments, which owns a significant stake in Lululemon Athletica, had proposed former Ralph Lauren executive Jane Nielsen as the company’s next CEO.
On the other hand, Baird analyst has reiterated a Neutral rating on the stock and a $190 price target in response to the appointment of O’Neill as the next CEO, effective September 8. According to the analysts, the roughly four-month gap before O’Neil takes over may keep key strategic and governance questions open.
Lululemon Athletica Inc. is a multinational retailer. It designs and sells technical athletic apparel, footwear, and accessories. The company began with women’s yoga wear but has grown into a global lifestyle brand. Now it serves men and youth involved in running, training, and golf.
7. Franco-Nevada Corporation (NYSE:FNV)
Relative Strength Index Reading: 31.70
Stock Upside Potential: 35.83%
Number of Hedge Fund Holders: 41
Franco-Nevada Corporation (NYSE:FNV) is one of the most oversold Canadian stocks to invest in. On April 29, Canaccord analyst Carey MacRury upgraded Franco-Nevada Corp to a Buy from a Hold rating. The upgrade comes amid expectations that the company is positioned to benefit from higher gold prices.
The research firm expects gold prices to average $4,758 per ounce in 2026, up from its previous guidance of $4,401. Some of the factors Canaccord expects to drive higher gold prices include supportive central bank policies and unresolved global trade issues. Geopolitical tensions, driven by the escalation of war in the Middle East, are also expected to fuel demand for the precious metal.
Canaccord does not see any clear end in sight to the Iran conflict, which supports the case for higher gold prices. In addition, gold is expected to benefit from central banks’ monetary policy. The research firm expects Franco-Nevada Corp. and other gold producers to deliver improving margins and profitability as capital spending remains low.
Franco-Nevada Corporation is the leading gold-focused royalty and streaming company. It manages the largest and most diversified portfolio of cash-flow producing assets in mining and energy. The company does not operate mines, develop projects, or conduct exploration. Instead, it provides financing to mining companies in exchange for long-term rights to production.
6. Ero Copper Corp. (NYSE:ERO)
Relative Strength Index Reading: 32.68
Stock Upside Potential: 42.39%
Number of Hedge Fund Holders: 19
Ero Copper Corp (NYSE:ERO) is one of the most Oversold Canadian stocks to invest in. On May 4, Ero Copper Corp delivered solid first-quarter results attributed to solid operating performance across the company’s copper operations. The company also benefited from necessary ventilation circuits and cooling upgrades undertaken at the Xavantina operation.
Total copper production in the quarter totaled 17,287 tonnes at C1 cash of $2.39 per pound. Gold production totaled 5,495 ounces at an all-in-sustaining cost of $4,441. The company sold 10,330 ounces of gold. Net income in the quarter totaled $108.8 million, or $1.04 per share, while adjusted net income attributable to shareholders totaled $72.4 million, or $0.69 per diluted share.
Ero Copper Corp’s net debt shrank by $11 million to $490.7 million, resulting in a further reduction of the net leverage ratio to 1.0X. For the full year, the company is projecting copper production of between 67,500 and 77,500 tons. Total capital expenditure is expected to be between $275 and $320 million.
Ero Copper Corp. is a Vancouver-based mining company focused on producing copper, with gold and silver byproducts, primarily through operations in Brazil. Its key assets include the Caraíba operations (Bahia), the Tucumã operations (Para), and the Xavantina gold operation.
5. Agnico Eagle Mines Limited (NYSE:AEM)
Relative Strength Index Reading: 34.21
Stock Upside Potential: 48.51%
Number of Hedge Fund Holders: 56
Agnico Eagle Mines Limited (NYSE:AEM) is one of the most oversold Canadian stocks to invest in. On April 30, Agnico Eagle Mines Limited delivered impressive first-quarter results characterized by record operating margins and production and costs tracked well with the plan.
Gold production in the quarter totaled 825,109 ounces, at approximately 24% of the midpoint of the full year production guidance. While the company realized $4,861 per ounce of gold prices in the quarter, it ended with record operating margins and adjusted net income. Net income totaled $1,695 or $3.39 per share, and a record adjusted net income of $1,706 or $3.41 a share. Revenue in the quarter totaled $4.1 billion, below the $4.12 billion expected.
During the quarter, Agnico Eagle Mines Limited increased its cash balance by $246 million to $3.11 billion. For the full year, Agnico Eagle Mines is on course to produce 3.3 to 3.5 million ounces, with production weighted approximately 485 in the first half and 52% in the second half.
Agnico Eagle Mines Limited is a senior Canadian-based gold mining company, ranking as the world’s second-largest gold producer, with operations in Canada, Australia, Finland, and Mexico. Founded in 1957, the company focuses on exploring, developing, and producing gold, with additional production of silver, zinc, copper, and lead.
4. FirstService Corporation (NASDAQ:FSV)
Relative Strength Index Reading: 30.13
Stock Upside Potential: 56.42%
Number of Hedge Fund Holders: 33
FirstService Corporation (NASDAQ:FSV) is one of the most oversold Canadian stocks. On April 27, Stifel analysts reaffirmed a Buy rating on FirstService Corporation and reduced the price target to $200 from $215.
The bullish stance follows the company’s strong first quarter 2026 results. Adjusted EBITDA reached $105.7 million, above consensus estimates of $103.8 million. Despite this, the price target was cut due to the underperformance of home improvement brands, which saw a sharp decline in demand.
In addition, Stifel remains wary of the roofing segment, which is under pressure amid weak commercial construction activity. However, bid activity in the segment is showing signs of improvement. The restoration segment is also expected to return to growth in the second half of the year, which should help FirstService Corporation achieve mid-single-digit growth.
The research firm also expects the company to receive a significant boost from acquisitions and short-term related restoration revenues.
FirstService Corporation leads North America in property services, operating through two divisions: FirstService Residential (condo and HOA management) and FirstService Brands (franchise and company-owned services like California Closets, CertaPro Painters, and Paul Davis Restoration).
3. Eldorado Gold Corporation (NYSE:EGO)
Relative Strength Index Reading: 34.31
Stock Upside Potential: 68.39%
Number of Hedge Fund Holders: 22
Eldorado Gold Corporation (NYSE:EGO) is one of the most Oversold Canadian stocks to invest in. On April 30, Eldorado Gold Corporation delivered impressive first-quarter results, capitalizing on higher gold prices.
Gold production in the quarter totaled 100,358 ounces, and the company sold 100,619 ounces at an average realized price of $4,891. Production costs in the quarter totaled $188.2 million, as capital expenditures totaled $318 million. Eldorado Gold Corporation has reiterated its 2026 annual production guidance of 490,000 and 590,000 ounces of gold.
Revenue in the first quarter totaled $532.4 million, resulting in net cash generated from operating activities of $141.4 million. Adjusted net earnings attributable to shareholders totaled $188.2 million or $0.95 earnings per share. During the quarter, the company completed the acquisition of Foran Mining Corporation. With the acquisition, the company has added McIlvenna Bay, a high-quality, long-life asset in a premier mining jurisdiction. The asset provides exposure to high-quality multi-decade Canadian copper, zinc, gold, and silver assets.
Eldorado Gold Corporation is a Canadian-based mid-tier mining company that explores, develops, and operates high-quality gold and base metal (copper, silver, lead, zinc) properties. With over 30 years of experience, it operates mines primarily in Turkey, Canada, and Greece, focusing on producing gold bullion and concentrates.
2. Orla Mining Ltd. (NYSEAMERICAN:ORLA)
Relative Strength Index Reading: 33.76
Stock Upside Potential: 77.87%
Number of Hedge Fund Holders: 25
Orla Mining Ltd (NYSEAMERICAN:ORLA) is one of the most oversold Canadian stocks to invest in. On April 13, Orla Mining Ltd management reiterated that they are on track to meet full-year consolidated gold production of between 340,000 and 360,000 ounces.
The sentiments follow an impressive start to 2026, with the company providing an updated feasibility study for the South railroad project. It has also completed the Preliminary Economic Assessment (PEA) for the Camino Rojo underground project, secured permits for the open pit expansion, and reported exploration results in Canada. In the quarter, the company produced 81,206 ounces of gold. It also capitalized on the higher gold prices by selling 81,540 ounces.
Musselwhite Operations produced 333,495 tons of ore and processed 332,822 tons at a mill head grade of 6.29 g/t gold. On the other hand, Camino Rojo operations produced over 2.2 million tons of ore and nearly 2 million tons of waste. Orla Mining exited the quarter with $427.3 million in cash and $331.3 million in debt.
Orla Mining Ltd. is a Canada-based, mid-tier gold producer focused on acquiring, exploring, developing, and operating mineral properties in North and South America. The company primarily operates the Camino Rojo Oxide Gold Mine in Mexico and the Musselwhite Mine in Canada, focusing on gold and silver extraction.
1. TRX Gold Corporation (NYSEAMERICAN:TRX)
Relative Strength Index Reading: 34.23
Stock Upside Potential: 106.14%
Number of Hedge Fund Holders: 4
TRX Gold Corporation (NYSEAMERICAN:TRX) is one of the most oversold Canadian stocks to invest in. On April 8, TRX Gold Corporation announced topline test results at its Buckreef Gold project in Tanzania. The company also plans to expand its processing plant at the project.
The expansion push comes as the company achieved solid recovery rates of 89%-92% at the project, exceeding the 88% rate assumed in the May 2025 Preliminary Economic Assessment. The solid recovery rates have prompted the company to specify a semi-autogenous grind/Ball mill combination processing 3,500+ tonnes per day. The company’s existing 2,000 tpd processing plant is poised for significant upgrades and will continue operating alongside a new 3,500+ tpd SAG mill processing plant.
The solid recovery rates and expansion plans align with the company’s record second-quarter fiscal 2026 results, with 7,453 ounces of gold. At an average realized price of $4,655 per ounce, TRX Gold ended up generating $34.1 million in revenues, gross profit of $21.1 million, and adjusted EBITDA of $20.2 million.
TRX Gold Corporation is a junior gold producer focused on exploring, developing, and operating the Buckreef Gold Project in Tanzania. It operates a high-margin, expanding gold mine in partnership with STAMICO. The company is currently scaling up production, upgrading plant capacity, and exploring ways to increase its mineral resource base in the Geita District.
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