1 TSX stock with a huge dividend and a re-opening on the rise

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There aren’t always absurdly cheap stocks on the TSX that trade at multiple lows. Many value hunters are rushing to pick them up, driving up prices when they get the chance. However, when there is a moment of market inefficiency, usually caused by a panic situation, there can be too many cheap stocks outnumbering the appetite of value hunters. Indeed, the value made a big comeback in the middle of the 2022 stock market correction. Although it may have bottomed out on Wednesday as the best deals were scooped up, I still think there are plenty of games out there. great catch-up value for investors looking for a way to end the year on a high note.

What should you buy when the market throws a tantrum? Look at stocks that have changed little on the long-term narrative or growth story. Have exogenous events negatively impacted a company’s ability to generate revenue over the next three or five years? What about operating margins? And the possibility for disruptors to question these measures?

If none of these are negatively affected, you may very well have a good deal in your hands. It is important to pay attention to potential competitors, as they can harm a business’s growth and margins in potentially drastic ways, causing the valuation to reset at some point. Indeed, we must also insist on a margin of safety in times like these. With markets correcting, many names may have a perceived margin of safety. Thus, investors may require an even larger margin of safety. In this article, we’ll look at one of the best stocks that I consider incredibly cheap as the markets attempt to stage a comeback after what has been a sharp correction so far.

Consider the shares of International restaurant brands (TSX:QSR)(NYSE:QSR).

International restaurant brands

Restaurant Brands has been under pressure for some time now. Currently down 30% from its mid-2019 highs, I consider QSR stock to be one of the most intriguing reopening plays today. The owner of Burger King, Tim Hortons and Popeye’s Louisiana Kitchen now boasts a sizable dividend yield of just under 4%. This is the highest for a long time. With COVID likely to become rampant at some point over the next year or two, I think the reopening of the name is underrated. Why?

QSR has been hit hard by dining room closures and Tim Hortons has struggled to adapt, as many of its locations were not equipped with drive-thrus. Indeed, QSR was not built with a pandemic in mind. As dining halls reopen and Canadians flock to Tim Hortons for their daily double-doubles, I’d be looking for the name to stage a massive turnaround. At 21.4 times earnings, stocks look modestly valued. Still, given the potential reopening earnings growth that could be on the cards, I would consider the name a permanent hold to consider buying today before quarterly results have a chance to pick up. Simply put, QSR holds some legendary brands, but its stock has mostly faded into the background, making it one of the most badly downgraded titles on my books.

The business is doing well as Tim Hortons is considering price increases in response to inflation. What better than a mythical brand to protect yourself from inflation? With digital growth accelerating (up 65% YoY), QSR stocks are a must-have for the core of any Canadian portfolio aiming for long-term appreciation.

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