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3 Investor-Favourite TSX Stocks Lose Big in 2021: Should You Buy?

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We are halfway through 2021, and Canadian markets seem in great shape to soar higher. Amid the valuation concerns and uncertain recovery from the pandemic, TSX stocks have been making fresh highs for the last few months. However, some of the names have been significantly lagging the markets. Here are three top losers so far in 2021.

Cargojet

The air cargo stock Cargojet (TSX:CJT) was among the top performers in the last decade. However, as the world started looking beyond the pandemic, the Street started losing interest in this growth stock. Cargojet stock has fallen almost 20% this year as compared to the 17% gain of the TSX Composite Index.

The pandemic acted as a catalyst for Cargojet when air cargo demand surged dramatically last year. Its top line grew by almost 40% in 2020 year over year, clocking the best revenue growth since 2015. However, as the world moves to normalcy and restrictions wane, the company could see relatively lower demand in the next few quarters.

Cargojet ensures overnight delivery to more than 90% of the Canadian population due to its unique network. It operates 29 aircraft and carries over 1.8 million pounds of time-sensitive air cargo each business night. Approximately 75% of its total revenues come from long-term contracts.

Ballard Power Systems

The fuel cell maker stock Ballard Power Systems (TSX:BLDP)(NASDAQ:BLDP) was one of the top losers, losing nearly 40% so far in 2021. Fuel cell stocks started the year on a very upbeat note, and Ballard stock rose 67% in January. However, weaker Q1 2021 results and valuation concerns brought the stock significantly down.

Ballard Power posted a revenue de-growth of 26% in Q1 2021 and widened losses compared to a year-ago quarter. The subsequent downgrades and bearish stance of analysts weighed on the stock.

So, what should investors do?

Fuel cell stocks are attractive investment avenues for investors looking for clean energy options. Ballard Power offers handsome growth potential, as clean energy for transportation takes centre stage. However, the industry is still in the nascent stage, and consistent corporate profitability looks highly challenging at the moment.

B2Gold

Gold stocks took a solid beating this year, as investors shrugged off inflation fears and continued to invest in risky assets. Almost all gold stocks have been weak this year after recording one of the best years in 2020. Canadian miner B2Gold (TSX:BTO)(NYSE:BTG) stock has lost 28% this year.

B2Gold’s Q1 results were weak and weighed on its stock. In addition, subdued yellow metal prices have also been pulling miner stocks down this year. Its revenues surged 55% year over year in 2020. However, coming into 2021, its Q1 revenues, in fact, fell 5% as against Q1 2020.

Importantly, the gloomy outlook for gold makes a strong bearish case for gold miners. How inflation plays out post-pandemic will have a key impact on gold prices. Notably, B2Gold stock is currently trading at a discount compared to the industry average, which indicates a potential upside in case gold rallies.

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.

The Motley Fool owns shares of and recommends CARGOJET INC. Fool contributor Vineet Kulkarni does not have any positions in the stocks mentioned. 

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