The idea for today’s commentary on Barchart’s top and bottom 100 stocks to buy comes from a Globe and Mail article yesterday about a Canadian couple using their TFSA (tax-free savings account), much like a Roth IRA, to build a $4 million investment portfolio.
The couple maxed out their annual TFSA contributions starting in 2009, when the Canadian government created the TFSA, until their combined portfolio reached $2 million. At that point, there was no point in continuing to add more, even though they could have.
To reach $4 million, the husband invested his funds in two stocks on the brink of bankruptcy: Air Canada (ACDVF)and Bombardier (BDRBF). While both companies have been through many ups and downs, Bombardier has been the more successful of the two over the past five years, increasing more than 2,000%. Now focused on the luxury aircraft market, business is going very well.
I subscribed to the Globe, so I gave the article away. I recommend you read it, if only to understand that buying weakened stocks can be a winning play, but you have to know what you’re doing.
In a nutshell, that makes me think about these two bottom 100 stocks to buy that are trading above $10.
Cava Group (CAVA)Shares are down 67% over the past 52 weeks and down 74% from their all-time high of $172.43 on Nov. 13, 2024.
As with all depressed stocks, there’s usually a good reason for getting there. Markets are reasonably efficient at discovering impostors.
In the case of Cava, it is in a no-win situation where customers are cutting back on spending due to inflation, economic uncertainty, fears of job losses and a technological fix; the list goes on.
This is not necessarily specific to Cava alone. Same-store sales across the fast-casual universe have been weak, especially among younger customers.
“‘When you look at the different age demographics of fast casual, the 25- to 34-year-old consumer seems to be affected a little more than others, and fast casual tends to have a higher concentration of those consumers within its guest base,’ Chief Financial Officer Tricia Tolivar said in an interview, adding that the company saw demand drop heading into the final quarter of the year,” CNBC reported Nov. 4.
Cava comparable sales in the third quarter of 2025 increased 1.9% with stable traffic compared to last year. As a result, the restaurant chain lowered its 2025 same-store sales guidance to 3.5% at the midpoint, down from 5% previously.
Since announcing its results after the markets closed on November 4, its shares have lost 13% of their value.
So the question is: how far can CAVA go?
It went public in June 2023 at $22. In 2022, its revenue was $564.1 million and it posted an operating loss of $59.8 million, resulting in an operating margin of -10.6%. In the trailing 12 months ended October 5, its operating margin was 5.5% on $1.13 billion in revenue.
In three years, it went from an operating loss to an operating profit. Cava’s market capitalization is a third of what it was last November, but it is still moving in the right direction.
In the Globe article, Globe contributor Larry MacDonald mentions that the TFSA investor used call options to boost the pair’s returns on Air Canada.
The same could happen with Cava. The $80 call option expires just before Christmas 2026. The net debit of $465 is 10.3% of its current stock price. While the probability of making a profit of 17.3% is low, there is also a chance that the stock will appreciate 33% and you will double your money by selling the call before it expires.
It may not reach $84.65, but it could still reach $60.27. The expected move takes the stock to $65.22 higher.
Bellring Brands (BRBR)Shares are down 67% over the past 52 weeks and down 69% from their all-time high of $80.67 on January 30, 2025.
Post Holdings (POST) spun off Bellring in October 2019 at $14. Post owned approximately 75% of the shares after the IPO. Post sold all of his shares in November 2022, when his shares were trading around $23, slightly below the current price.
Over the last three fiscal years (September year-end), Bellring has grown its revenue by 69% to $2.32 billion. At the same time, its operating income increased 68% to $357.4 million. Its operating margin is about the same: 15.4%.
That’s not so horrible. He had lost track of Bellring last year. Obviously, something happened to cause a 69% drop since February. The easiest place to look for clues is the inevitable class action lawsuit press releases that appear after significant drops in a stock’s price.
In Bellring’s case, the growth issues it faced first emerged in May, when it reported its second-quarter 2025 results. More issues emerged in August. Its shares lost almost 19% on May 6 and 33% on August 5. Bellring reported fourth-quarter 2025 results this morning before markets opened. Its shares are down about 3.5% after 1.5 hours of the trading day.
Bellring’s guidance suggests competition is growing. It expects fiscal 2026 sales to rise 6% at the midpoint to $2.45 billion. Its adjusted EBITDA should be $440 million. Starting in 2027, sales are expected to grow 8% annually, with EBITDA margins of 19%.
When Bellring went public in October 2019, it was valued at $551 million based on 39.4 million shares outstanding. However, assuming that Post Holdings’ 71.2% stake in the operating LLC was redeemable for 97.4 million shares, the full 100% would be worth $1.92 billion. As of November 2022, after Post sold the remaining 4.6 million shares it owned, Bellring’s market capitalization was approximately $3.11 billion based on 135.3 million shares outstanding.
That’s a price-to-sales ratio of 2.27. The P/S multiple today is 1.36, down around 40%, with operating income down 41%. If there was ever a bottom 100 stock to buy, it would be BRBR. Here is a call to consider betting on BRBR.
The $45 call expires at the same time as the previous CAVA call. The net debit of $260 is 10.5% of your current stock price. With a profit probability of 18.99%, if the stock appreciates 33%, you can double your money by selling the call before it expires in December 2026.
The hardest part of this might be seeing enough volume to buy one or two $45 calls.
On the date of publication, Will Ashworth had no (directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are for informational purposes only. This article was originally published on Barchart.com
