The TSX is likely to continue its mild bull run after posting a record high on May 7, 2021. Despite 10 consecutive weeks of gains, investors can still find bargain deals in the stock market.
The bright spot in the cannabis space
Village Farms International (TSX:VFF)(NASDAQ:VFF) should be on fire soon, notwithstanding the 37.8% drop in value from mid-March 2021. However, the current share price of $13.49 is 193.9% more than the $4.59 a year ago. Market analysts are bullish and see a potential upside of 92.7% to $26.
The cannabis space remains volatile, although the $1.07 billion greenhouse produce grower has massive growth potentials ahead. Village Farms is one of the select few in the sector that’s making profits and generating cash flows. Cannabis production isn’t the core business, so if the venture goes haywire, the company has a fallback in cucumbers, peppers, and tomatoes.
Village Farms is one of North America’s largest and longest-operating vertically integrated greenhouse growers. Pure Sunfarms, a wholly owned subsidiary, boasts the single largest cannabis growing operations in the world. This subsidiary owns the top-selling dried flower brand in Ontario, Canada. Its goal is to become a key player in the hemp-derived CBD market in America.
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Balance sheet preservation
A 51.8% gain in one year on investment as low as $5,000 should be suitable for frugal investors. You can purchase Crescent Point Energy (TSX:CPG)(NYSE:CPG) at $5.27 per share today and reap the fantastic rewards. The $2.79 billion oil producer from Calgary, Alberta, also pays a very modest 0.19% dividend.
The 2020 earnings results were not rosy due to the collapse in crude oil demand and pricing combined with the global COVID-19 pandemic. Nevertheless, management’s execution capabilities amid one of the most challenging periods kept Crescent Point Energy afloat. Preserving the balance sheet during 2020 was the priority.
After generating $120 million in excess cash flow and receiving $500.2 million from its divestment in the Saskatchewan gas infrastructure asset, Crescent Point used $616.6 million to pay and reduce debts. In February 2021, the company announced the acquisition of Crescent Shell Canada Energy’s Kaybob Duvernay assets. It should enhance the balance sheet further and ensure sustainability.
Visible growth potentials
Ballard Power Systems (TSX:BLDP)(NASDAQ:BLDP) is on a free fall since late April 2021, so it becomes an interesting pick for bargain hunters. At $18.69 per share, you’d be purchasing the industrial stock at a 37% discount.
Apart from the 26% drop in revenue in Q1 2021 (quarter ended March 31, 2021) versus Q1 2020, the company reported a US$17.8 million in net loss. However, cash reserves increased by 600% to $1.2 billion. Despite falling short of first-quarter estimates, the business outlook for the $5.56 billion fuel cell manufacturer remains encouraging.
Ballard forged an alliance with Canadian automobile parts manufacturer Linamar to build fuel-cell powertrains. It will also build components for passenger cars, SUVs, light trucks, and commercial vans not to exceed five tons. The initial target markets for these products are North America and Europe. With hydrogen fuel cells gaining popularity worldwide, expect Ballard to be at the front and centre of it all.
Investors shouldn’t miss a beat and scoop Ballard or the two other bargain stocks before the eventual breakouts in 12 months or fewer.
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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. The Motley Fool owns shares of and recommends Village Farms International Inc. The Motley Fool owns shares of Village Farms International, Inc.