There are fast-growing stocks on the TSX that investors should know more about. Fast growth doesn’t necessarily mean your investment will double in the wink of an eye. However, when you purchase the stocks today, the probabilities of realizing market-beating returns in the near future are greater.
The stocks I’m talking about are Alcanna (TSX:CLIQ), Martinrea International (TSX:MRE) and Neptune Wellness Solutions (TSX:NEPT)(NASDAQ:NEPT). These firms are undergoing major makeovers aimed to reinvigorate the businesses and produce record-breaking bottom lines.
Half-liquor, half-weed stock
Alcanna, Canada’s premier retailer of wine, spirits, and beer, is including cannabis in the product mix. The combination of pot retail and alcohol retail is a powerful formula. Investors skeptical of cannabis companies have a covert way of gaining exposure into the space.
Blockbuster sales are expected in Alcanna’s 236 liquor stores when the licences to sell cannabis are obtained. There are already five cannabis stores under the Nova Cannabis brand in Alberta. Supply won’t be a problem because Aurora Cannabis owns 25% of Alcanna.
Alcanna’s cannabis retail will make a lot of money and make up for the slowing liquor business. There is the strong possibility of Aurora vertically integrating into Alcanna’s channel. The company also pays a 3% dividend, which is an added upside. There’s no dividend-paying weed stock with such high growth potential.
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Overblown NAFTA worries
Investors should stick to Martinrea International. The company is still the leading provider of quality metal parts, assemblies, and complex aluminum products, among others in the automotive sector. The business slowed down last year when the renewal of the NAFTA hanged in the balance.
With the new but highly criticized NAFTA deal in place, the operations in Martinrea’s more than 47 manufacturing, engineering, and technical centres in Canada, the U.S., Mexico, and in five other countries will be back to normal.
The Q1 2019 sales were over a billion, and CEO Pat D’Eramo said the earnings from the international markets are projected to increase by 27%. This presents a prime buying opportunity given the highly optimistic future of the diversified global automotive supplier.
Investors can expect more robust cash flows that will eventually result in higher share value. MRE pays a 1.7% annual dividend, too.
The “Sea God” is rising
NEPT is up 84.39% year to date, and the general uptrend is likely to continue with the change in focus. The company is upgrading from an Omega-3 oil extractor to a cannabis oil extractor.
Neptune Wellness will leverage the experience in extraction, purification, and formulation of value-added cannabis products. The company has secured the licence to process cannabis from Health Canada. The commercial production and shipping of cannabis extracts from the licensed facility in Quebec began in March.
Neptune acquired North Carolina-based hemp processor SugarLeaf Labs last May in preparation for the entry in the U.S. hemp-derived CBD market. The company will provide extraction and related services to Tilray and Green Organic Dutchman. Both deals are for three years.
Fast growing is an understatement for these three companies in face-lift mode.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Christopher Liew has no position in any of the stocks mentioned.