2 Undervalued Bank Stocks and REITs Worth Buying in 2026

The Canadian stock market in 2026 is still a mixed bag of opportunities. While some sectors are flying high (energy), savvy investors know that the “easiest” wealth is built by finding high-quality undervalued stocks trading at a significant discount to their intrinsic values. If you are looking to put some capital to work in May, here are two bank stocks and two real estate investment trusts (REITs) that look like absolute steals today.

goeasy stock fending off unsolicited acquisition bids

It’s fair to say the going isn’t currently easy for goeasy (TSX:GSY). This consumer lender has hit a rough patch in the subprime market, leading to a staggering 87% drop in its stock price over the past few months. At these levels, the stock is so deeply undervalued that it may attract the attention of “corporate vultures” looking to snatch up its assets at a hefty discount.

To protect long-term unitholders, management has adopted a shareholder rights plan (SRP) on May 12, 2026. This “poison pill” triggers if an acquirer hits a 20% stake, allowing existing shareholders to buy heavily discounted shares and making a hostile takeover much more expensive.

goeasy’s business model isn’t permanently broken. It remains a cash-flow-rich financial services company with a massive loan portfolio that can sustain steady loan originations from repayments while charge-off rates improve. In the first quarter of 2026, revenue grew organically by 2%. Trading at a price-to-book (P/B) multiple of just 0.6, you are essentially buying a potential high-stakes recovery play for 60 cents on the dollar.

Toronto-Dominion Bank (TD) stock

Toronto-Dominion Bank (TSX:TD) stock has had a strong run, delivering a 71.5% total return over the past year. However, the Canadian bank stock could still be undervalued relative to “Big Six” peers as it profitably pivots to Canadian banking growth while navigating a temporary U.S. asset cap.

Currently, TD stock trades at a historical P/E ratio of roughly 12. When you compare that to its peers, the “valuation gap” is glaring. Scotiabank sits at 15.8, Bank of Montreal stock is at 17.5, and National Bank is pushing a P/E of nearly 20. Even CIBC and the Royal Bank of Canada trade at significantly higher multiples of 16 and 17.3, respectively. For a top bank stock with TD’s scale, liquidity, and North American footprint, this 12 times multiple represents an undervalued bargain for investors who want blue-chip safety without paying a blue-chip premium.

CAPREIT 39% undervalued

The fundamental investment math of Canadian real estate is simple: the population needs more housing than is currently available. As one of the country’s largest residential landlords with 45,587 suites, Canadian Apartment Properties REIT (TSX:CAR.UN) should be a market darling. Instead, units have tumbled to around $33 — levels last seen in 2018.

CAPREIT’s portfolio is still doing well. Average monthly rents hit $1,732 for the first quarter, continuing a steady climb from 2025. Occupancy remains a “fortress-like” 97.1%, and net operating income (NOI) margins expanded year over year to 62.4%.

Most noteworthy, CAPREIT’s most recent net asset value (NAV) was $54.79 per unit. At current trading levels, new investors are acquiring units at a 39% discount to the fair value of the apartment buildings. Management is recycling capital and aggressively repurchasing units on the public market, enhancing coverage for the trust’s monthly distribution. The monthly distribution yields 4.6% annually and is well-covered with a conservative 65.1% funds from operations (FFO) payout ratio, making this residential REIT a high-conviction buy for 2026.

Granite REIT

Investors who prefer industrial property economics over residential suites, Granite REIT (TSX:GRT.UN) is an undervalued gold standard. The industrial REIT owns 139 properties and exited the first quarter of 2026 with a jaw-dropping 98.3% occupancy rate. With an average lease term of 5.3 years, the portfolio’s cash flow is as predictable as it gets in the rental market.

Like its residential cousins, Granite is currently being ignored by the broader market. The REIT currently trades at a nearly 13% discount to its NAV of about $105.70. While you wait for valuations to improve, you can collect a very safe 3.8% monthly distribution yield. Granite REIT’s adjusted funds from operations (AFFO) payout ratio during the first quarter was a conservative 63%, leaving plenty of room for future distribution hikes or balance sheet strengthening.