The S&P/TSX Composite Index fell 10 points on April 25. The Index has still climbed 15.7% in 2019 so far. Investors have had their faith rewarded to start 2019, but those with their eyes on long-term gains should be thinking about what stocks will be high performers in the 2020s.
Today, we are going to look at two stocks that have enjoyed huge gains over the past year. Both stocks are players in fast-growing industries. Let’s see why these high-growth equities are great bets to continue surging in the coming years.
Aurora Cannabis (TSX:ACB)(NYSE:ACB)
Aurora Cannabis is one of the largest cannabis producers in Canada. Shares have climbed 80.2% in 2019 as of close on April 25. The stock is up 56% over the past year. Last month, I discussed how the addition of Nelson Peltz as a strategist had the potential to vault Aurora to the top of the cannabis pack in Canada.
Aurora is set to release its fiscal 2019 third-quarter results next month. The first batch of earnings for top producer Aphria were extremely disappointing. The bears are coming out for cannabis stocks this spring, and there are concerns that Aurora and other top producers are also in for a rough patch. An earnings miss can create buying opportunities for investors looking to dip into this young sector. Aurora is well worth monitoring ahead of its next report.
However, looking long, Aurora is a solid add at its current price. The company has made impressive strides in securing international partnerships and it has established itself as a production behemoth in Canada. Its production ramp-up is expected to result in a spike in revenues in the final quarter of this fiscal year. Aurora looks poised to be a big domestic and international player in this new and booming sector.
Zymeworks (TSX:ZYME)(NYSE:ZYME)
Zymeworks is a Vancouver-based clinical-stage company focused on multifunctional biotherapeutics. It has entered two product candidates into clinical trials: ZW25 and ZW49. In January, I explained why Zymeworks has enormous potential if it brings ZW25 to market.
The global breast cancer drug market will be worth $38.4 billion by 2025, according to a recent report from Grand View Research. This represents a compound annual growth rate (CAGR) of 10.7% from 2019 to 2025.
On April 15, Zymeworks announced that it had initiated its global multi-centre Phase II clinical trial evaluating its antibody ZW25. This two-part open-label study will aim to confirm the safety, tolerability, and anti-tumour activity of ZW25 in combination with standard care regimens. This is a big and exciting step for Zymeworks.
Market reactions to Zymeworks’s progress has historically been slow. Investors seemed to finally catch up to the news this week. Shares climbed 11% week over week as of close on April 25. Zymeworks has made solid progress, but it remains a speculative buy in late April. It is projected to generate negative EBITDA in the $20-25 million range in fiscal 2019. Not surprisingly, the company has ramped up research and development spending.
