Earlier this year, as June came to an end, Brianne Gardner, the Senior Wealth Manager at Velocity Investment Partners, Raymond James, appeared on BNN Bloomberg to state that Canadian stocks are outperforming the US stocks in 2025. Investors are optimistic following Canada’s announcement that it is rescinding a digital services tax that targeted large tech companies. Gardner described her view on Canadian stocks as cautiously optimistic. She credited Canada’s earlier interest rate cuts compared to the US Fed for helping the country avoid a major recession, although she did note that it is still possible for a recession to occur later.
Gardner explained that the early strength in the TSX this year came from the energy and gold sectors, but the momentum now appears to be fading. She cited mounting uncertainty, softer economic data, and pressure from the trade talks. She also added that the TSX’s performance has been heavily concentrated in the materials and energy sectors, which have accounted for over 30% of returns. Gardner also explained that her firm uses a rules-based investing philosophy where a stock must rank at a minimum of 7/10. This is based on both fundamental and technical criteria. The fundamental analysis involves looking at about 12 different credentials, such as the cash flow, balance sheets, and upside potential. The technical analysis focuses on the entry point, such as whether the stock is above or below its 50-day moving average, and considers factors like dividend yield and P/E ratio.
That being said, we’re here with a list of the 11 most undervalued Canadian stocks to buy now.
A financial analyst looking at a monitor displaying the stocks of the public company.
Methodology
We sifted through the Finviz stock screener to compile a list of the top undervalued Canadian stocks with a forward P/E ratio under 15, as of August 6. We then selected the 11 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q1 2025.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
11 Most Undervalued Canadian Stocks to Buy Now
11. Bausch Health Companies Inc. (NYSE:BHC)
Forward P/E Ratio as of August 6: 1.53
Number of Hedge Fund Holders: 31
Bausch Health Companies Inc. (NYSE:BHC) is one of the most undervalued Canadian stocks to buy now. On July 29, Bausch Health Companies announced a definitive agreement to acquire DURECT Corporation (NASDAQ:DRRX). The acquisition is valued at ~$63 million upfront with potential for an additional $350 million in sales milestone payments, and will be an all-cash transaction.
Bausch Health is acquiring DURECT primarily for its lead asset, called larsucosterol. This novel therapeutic molecule is an epigenetic modulator that the FDA has granted Breakthrough Therapy Designation for the treatment of alcoholic hepatitis/AH, which is a life-threatening form of alcohol-associated liver disease.
AH is characterized by severe liver inflammation & necrosis and accounted for ~164,000 hospital admissions in the US in 2021. There are currently no FDA or European Medicines Agency/EMA-approved treatments for the condition. The acquisition of larsucosterol strengthens Bausch Health’s commitment to hepatology. Bausch Health plans to use its expertise to advance larsucosterol through a planned Phase 3 program.
Bausch Health Companies Inc. (NYSE:BHC) is a diversified specialty pharmaceutical and medical device company that develops, manufactures, and markets products in gastroenterology, hepatology, neurology, dermatology, generic pharmaceuticals, OTC products, aesthetic medical devices, and eye health.
DURECT Corporation (NASDAQ:DRRX) is a late-stage biopharmaceutical company that develops epigenetic therapies that target dysregulated DNA methylation to transform the treatment of serious and life-threatening conditions, such as acute organ injury.
10. Manulife Financial Corporation (NYSE:MFC)
Forward P/E Ratio as of August 6: 10.68
Number of Hedge Fund Holders: 32
Manulife Financial Corporation (NYSE:MFC) is one of the most undervalued Canadian stocks to buy now. On August 6, Affiliated Managers Group Inc. (NYSE:AMG) announced that it agreed to sell its interest in Comvest Partners’ private credit business to Manulife Financial Corporation. The transaction is expected to close in Q4 2025, subject to customary closing conditions.
Affiliated Managers Group, or simply AMG, is set to receive ~$285 million in total cash for the sale. The company will also retain its interest in Comvest’s private equity business, along with an interest in the carry from certain existing private credit funds and a share of Comvest’s invested capital in those funds. AMG will also sell its interest in the AMG Comvest Senior Lending Fund joint venture.
For over 25 years, Comvest Partners has focused on providing capital to North American middle-market companies. The partnership between AMG and Comvest began over 5 years ago. At the start of the collaboration, Comvest’s private credit business had $2 billion in assets under management/AUM, which grew to $14 billion at the time of the acquisition announcement.
Manulife Financial Corporation (NYSE:MFC) provides financial products and services through 3 segments: Wealth & Asset Management Businesses, Insurance & Annuity Products, and Corporate & Other.
Affiliated Managers Group Inc. (NYSE:AMG) is an investment management company that provides investment management services to mutual funds, institutional clients, and high-net-worth individuals in the US.
9. Nutrien Ltd. (NYSE:NTR)
Forward P/E Ratio as of August 6: 13.57
Number of Hedge Fund Holders: 32
Nutrien Ltd. (NYSE:NTR) is one of the most undervalued Canadian stocks to buy now. On August 1, TD Securities raised the firm’s price target on Nutrien to C$70 from C$67, while keeping a Buy rating on the shares. Following this announcement, the company reported its Q2 2025 financial results with net earnings of $1.2 billion and $2.65 diluted net EPS for the overall first half of the year.
The company saw record Potash sales volumes, increased Nitrogen operating rates, and a reduction in expenses in H1. The company’s performance by segment showed an increase in adjusted EBITDA for both Potash and Nitrogen, which reached $1.1 billion each in H1. Potash benefited from higher net selling prices and record sales volumes, while Nitrogen’s performance was supported by higher prices and sales volumes, achieving a record ammonia operating rate of 98%.
Nutrien raised its 2025 full-year Potash sales volume guidance to a range of 13.9 to 14.5 million tonnes and increased its global potash shipment forecast to 73 to 75 million tonnes. All other operational guidance ranges remain unchanged.
Nutrien Ltd. (NYSE:NTR) provides crop inputs and services. The company operates through 4 segments: Nutrien Ag Solutions, Potash, Nitrogen, and Phosphate.
8. Pan American Silver Corp. (NYSE:PAAS)
Forward P/E Ratio as of August 6: 15.90
Number of Hedge Fund Holders: 32
Pan American Silver Corp. (NYSE:PAAS) is one of the most undervalued Canadian stocks to buy now. On August 6, Pan American Silver Corp. announced the immediate appointment of Pablo Marcet to its Board of Directors. The appointment is part of the company’s board renewal strategy and commitment to governance and operational excellence.
Mr. Marcet brings over 35 years of international experience in the mining industry, with a focus on exploration, development, and operations across the Americas and Africa. His expertise includes geology, environmental management, mine operations, stakeholder engagement, and mergers and acquisitions.
He has held senior leadership positions at companies such as Orosur Mining, Waymar Resources, Northern Orion Resources, and spent 15 years at BHP, with a primary focus on Latin America. Mr. Marcet is currently the Executive Director of Piche Resources and the founder and President of Geo Logic, which is a mining consultancy firm.
Pan American Silver Corp. (NYSE:PAAS) explores, mines, develops, extracts, processes, and refines mines in Canada, Mexico, Peru, Bolivia, Argentina, Chile, and Brazil. It explores for silver, gold, zinc, lead, and copper deposits.
7. Equinox Gold Corp. (NYSE:EQX)
Forward P/E Ratio as of August 6: 14.60
Number of Hedge Fund Holders: 33
Equinox Gold Corp. (NYSE:EQX) is one of the most undervalued Canadian stocks to buy now. On July 28, Equinox Gold Corp. provided an update on its exploration campaign at the El Limon Mine Complex in Nicaragua. The initial results from the planned 100,000-meter drilling program in 2025 have yielded the highest-grade gold mineralization discovered to date on the property.
These results indicate significant potential to extend the mineralized corridor to the north and west of the current producing deposits. The drill results included several high-grade intercepts, such as 36.77 grams per tonne (g/t) gold over 6.9 meters estimated true width/ETW, 8.55 g/t gold over 14.6 meters ETW, and 10.19 g/t gold over 6.0 meters ETW.
The drill program is active and is testing 3 areas: the area adjacent to the Panteon underground mine, the multi-kilometer VTEM Gold Corridor, and the area along the trend of the past-producing Talavera mine. Equinox Gold acquired the Nicaraguan assets from B2Gold in Q4 2019. At the time, the assets had a combined mineral reserve of ~140,000 ounces of gold.
Equinox Gold Corp. (NYSE:EQX) acquires, explores, develops, and operates mineral properties in the Americas. The company primarily explores gold and silver deposits.
6. Cenovus Energy Inc. (NYSE:CVE)
Forward P/E Ratio as of August 6: 16.03
Number of Hedge Fund Holders: 39
Cenovus Energy Inc. (NYSE:CVE) is one of the most undervalued Canadian stocks to buy now. On August 1, Raymond James raised the firm’s price target on Cenovus Energy to C$30 from C$29, while keeping an Outperform rating on the shares. This sentiment followed the company’s Q2 2025 earnings announcement, where the company reported a total of ~$2.4 billion in cash from operating activities, $1.5 billion in adjusted funds flow, and $355 million in free funds flow.
Total revenues for the quarter were $12.3 billion, which was a sequential decrease from $13.3 billion. Upstream production was 765,900 barrels of oil equivalent per day (BOE/d), which showed planned maintenance at the Foster Creek and Sunrise oil sands assets, as well as impacts from a wildfire at Christina Lake. Downstream crude throughput was 665,800 barrels per day (bbls/d), with a utilization rate of 92%, including the early completion of a turnaround at the Toledo Refinery.
First oil was achieved at Narrows Lake in mid-July in this quarter as well, with production expected to ramp up to a peak of 20,000-30,000 bbls/d by the end of the year. The West White Rose project made progress, with the concrete gravity structure installed on the seabed in June and the topsides placed in mid-July. Drilling is expected to begin by the end of the year, with first oil projected for Q2 2026. At the Foster Creek optimization project, 4 new boilers were brought online in July, adding ~80,000 bbls/d of steam capacity.
Cenovus Energy Inc. (NYSE:CVE) develops, produces, refines, transports, and markets crude oil, natural gas, and refined petroleum products in Canada, the US, and China. It operates through Oil Sands, Conventional, Offshore, Canadian Refining, and US Refining segments.
5. Kinross Gold Corporation (NYSE:KGC)
Forward P/E Ratio as of August 6: 13.50
Number of Hedge Fund Holders: 39
Kinross Gold Corporation (NYSE:KGC) is one of the most undervalued Canadian stocks to buy now. On August 1, CIBC raised the firm’s price target on Kinross Gold to $22 from $21, while maintaining an Outperform rating on the shares. The firm cites the company’s solid operational execution for the target bump following its strong Q2 report.
In Q2, the company reported 513,000 gold equivalent ounces produced at a cost of sales of $1,074 per ounce. This performance led to a record operating margin of over $2,200 per ounce and a record free cash flow of $647 million. Kinross Gold’s financial position is strong, with over $1.1 billion in cash and ~$2.8 billion in total liquidity at the end of the quarter. Net debt has been reduced to ~$100 million.
Kinross Gold is on track to meet its full-year guidance targets of producing 2 million gold equivalent ounces, with a cost of sales of $1,120 per ounce and all-in sustaining costs of $1,500 per ounce. Total capital expenditures for the year are expected to be $1.15 billion. The company also reported returning almost $300 million to shareholders to date, including the repurchase and cancellation of $225 million in shares.
Kinross Gold Corporation (NYSE:KGC) acquires, explores, and develops gold properties principally in the US, Brazil, Chile, Canada, and Mauritania.
4. Suncor Energy Inc. (NYSE:SU)
Forward P/E Ratio as of August 6: 16.78
Number of Hedge Fund Holders: 44
Suncor Energy Inc. (NYSE:SU) is one of the most undervalued Canadian stocks to buy now. On August 6, TD Securities raised the price target on Suncor to C$63 from C$62, while keeping a Buy rating on the shares. This announcement followed Suncor’s Q2 2025 earnings report, when the company generated $2.7 billion in adjusted funds from operations and $1.0 billion in free funds flow.
Net earnings for the quarter were $1.134 billion, compared to $1.568 billion in the same period of 2024. The drop came from lower upstream price realizations.
Suncor achieved a record second-quarter upstream production of 808,000 barrels per day (bbls/d) and a record H1 production of 831,000 bbls/d. Total Oil Sands bitumen production also hit a Q2 record of 860,800 bbls/d. E&P output increased to 59,700 bbls/d, which included increased production from the Hebron and White Rose fields. Downstream, the company achieved a record Q2 refinery throughput of 442,000 bbls/d, with a utilization rate of 95%, and a record H1 throughput of 462,000 bbls/d. Refinery product sales also set a second-quarter record at 600,500 bbls/d.
Suncor Energy Inc. (NYSE:SU) is an integrated energy company in Canada, the US, and internationally. It operates through Oil Sands, Exploration & Production, and Refining & Marketing segments.
3. Lululemon Athletica Inc. (NASDAQ:LULU)
Forward P/E Ratio as of August 6: 13.24
Number of Hedge Fund Holders: 48
Lululemon Athletica Inc. (NASDAQ:LULU) is one of the most undervalued Canadian stocks to buy now. On August 4, Wells Fargo analyst Ike Boruchow lowered the firm’s price target on Lululemon to $225 from $270, while maintaining an Equal Weight rating on the shares. The firm believes that Lululemon remains in a tough spot. Wells Fargo mainly pointed to 3 key concerns: the lack of US comparable sales visibility, China growth trajectory, and H2 2025 margin headwinds.
The company’s net revenue increased by 7% year-over-year in Q1 2025 to $2.4 billion. Diluted EPS were $2.60, which was a slight increase from $2.54 in Q1 2024. Performance varied across regions. Americas’ net revenue in particular increased by 3%, while comparable sales decreased by 2%. In contrast, international net revenue surged by 19%, with comparable sales rising by 6%. Overall, company-wide comparable sales increased by 1%.
The company expanded its physical presence by adding 3 net new stores, which brought the total number of stores to 770. For Q2 2025, the company projects net revenue to be between $2.535 and $2.560 billion, which is a growth of 7% to 8%. Diluted EPS is expected to be in the range of $2.85 to $2.90.
Lululemon Athletica Inc. (NASDAQ:LULU) designs, distributes, and retails technical athletic apparel, footwear, and accessories for women and men under the lululemon brand in the US, Canada, Mexico, China Mainland, Hong Kong, Taiwan, Macau, and internationally.
2. Alamos Gold Inc. (NYSE:AGI)
Forward P/E Ratio as of August 6: 19.49
Number of Hedge Fund Holders: 50
Alamos Gold Inc. (NYSE:AGI) is one of the most undervalued Canadian stocks to buy now. On August 5, National Bank raised the firm’s price target on Alamos Gold to C$53.50 from C$51, while keeping an Outperform rating on the shares. Prior to this sentiment, Alamos Gold announced record revenue and strong production for the second quarter of 2025.
The company produced 137,000 ounces of gold, which was a 10% sequential increase. The performance was supported by a record $438 million in revenue. The company also saw improvement in its cost profile, with all-in sustaining costs decreasing by 18% sequentially.
The Island Gold District produced 64,400 ounces, a 9% increase, while Young-Davidson and the Mulatos District also saw increases of 9% and 12%, respectively, producing 38,700 ounces and 34,100 ounces. Alamos Gold is confident that its Island Gold District will become one of the largest and most profitable gold mines in Canada, with an expected annual free cash flow exceeding $1 billion after the completion of the Phase 3-plus expansion.
Alamos Gold Inc. (NYSE:AGI) is a gold producer in Canada, Mexico, and the US. The company primarily explores for gold deposits.
1. Canadian Natural Resources Limited (NYSE:CNQ)
Forward P/E Ratio as of August 6: 15.43
Number of Hedge Fund Holders: 52
Canadian Natural Resources Limited (NYSE:CNQ) is one of the most undervalued Canadian stocks to buy now. Earlier on July 17, National Bank raised the firm’s price target on Canadian Natural to C$45 from C$43, while keeping a Sector Perform rating on the shares.
After this announcement, the company also reported its Q2 2025 financial results on August 7. Some of the company’s year-to-date performance is also attributed to the completion of a planned turnaround at the Athabasca Oil Sands Project (or simply AOSP) 5 days ahead of schedule and on budget.
Despite the AOSP turnaround, which reduced production by ~120,000 barrels per day, Canadian Natural achieved a quarterly production volume of ~1.42 million BOE/d. This marked a 10% year-over-year increase due to both acquisitions and organic growth. Total liquids production was 1.019 million bbl/d, and natural gas production was 2.407 Bcf/d. Subsequent to the quarter, in July, Oil Sands Mining and Upgrading Synthetic Crude Oil/SCO production averaged 602,000 bbl/d with an upgrader utilization rate of 106%.
Canadian Natural Resources Limited (NYSE:CNQ) acquires, explores, develops, produces, markets, and sells crude oil, natural gas, and natural gas liquids/NGLs in Western Canada, the UK sector of the North Sea, and Offshore Africa.
While we acknowledge the potential of CNQ to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than CNQ and that has 100x upside potential, check out our report about the cheapest AI stock.
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Disclosure: None.
