Look For These Three Stocks To Rebound This Week

Posted on August 2, 2019 by Mathieu Litalien

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After last week’s highly volatile trade action, the TSX Index closed down 1.3%. Given the volatile nature of the markets currently, it is not surprising to see many stocks enter oversold territory.

If you’re new to buying stocks, a stock is considered oversold when its 14-day relative strength index (RSI) dips below 30. When this happens, there is an opportunity for a short-term bounce.

Taking that into account, here are three stocks that closed the week in oversold territory and could be due for a rebound this week.

NFI Group

Formerly known as New Flyers Industries, NFI Group (TSX:NFI) has been absolutely punished in 2019. Year to date, NFI’s stock has lost 25% of its value, five per cent in the past week alone.

The company is currently working through some operational and supply chain issues. This is what has led to it missing on earnings in the first couple of quarters of the year. However, the downwards pressure appears to be over done.

NFI Group is an industry leader, manufacturing low-carbon emission buses. In our environment of climate change, demand for its products aren’t likely to go away any time soon.

Trading at only 9.62 times forward earnings and a P/E to growth (PEG) of only 0.29, NFI Group is cheap.

Bank of Montreal

The Bank of Montreal (TSX:BMO) is the only one of Canada’s Big Banks to enter oversold territory this week. With an RSI of 22.23, BMO is poised for a bounce.

The key however, will be strong earnings momentum from the sector. This week, both Canadian Imperial Bank of Commerce (TSX:CM) and Royal Bank of Canada (TSX:RY) are scheduled to report earnings.

Strong earnings from either of these could lead to strong showing by BMO ahead of its earnings release next week.


With an RSI of 18.99, Enerflex (TSX:EFX) is among the most oversold stocks on the TSX, and in my opinion is one of the best stocks you can own in Canada today. As a natural gas service company, it has struggled significantly over the past few months as the price of gas has hit yearly lows.

The fear is that producers will reduce CAPEX which will hurt demand for the company’s products and services. Nevertheless, investors have been presented with once-in-a-decade opportunities to pick up industry-leading companies on the cheap.

Enerflex is no exception. The company is trading at only 9.53 times forward earnings and near 52-week lows. Once the price of natural gas rebounds, Enerflex is well positioned to reward investors with double-digit growth.

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Mathieu Litalien

About the author

Mathieu is an individual investor and has been investing part-time for the better part of the past 20 years. He is primarily interested in fundamental analysis, focusing on the long-term and his portfolio is composed primarily of dividend-paying equities. Mathieu has a moderate risk profile and also looks for growth and value. His passion for finance and the markets have led him to his MBA and writing for Seeking Alpha and Stocktrades. Mathieu also focuses primarily on stock research and content production for Stocktrades.ca Premium and the Stocktrades blog.