Two of the top small-cap growth stocks in Canada over the last year have been Score Media and Gaming (TSX:SCR)(NASDAQ:SCR) and Drone Delivery Canada (TSXV:FLT). Both SCR and FLT stock rallied significantly throughout the last year. Despite being two of the top growth stocks to buy, though, the two have had much different outcomes.
While both stocks lost some momentum after their major rallies throughout the last year, FLT has underperformed SCR stock.
Neither of these stocks were helped by the massive rallies we’ve seen across markets since. With other events in markets gaining a lot of attention, such as the Dogecoin pump, speculative investors had sold off these stocks, leaving them to be considerably cheap in recent weeks.
But despite these short-term price movements and volatility, both SCR and FLT stock have continued to offer great long-term growth potential.
However, recently, it was announced that SCR stock was being taken over, rewarding investors and showing the value its brand has always had. The acquisition should help Penn National Gaming to continue expanding its business and was a nice payday for those investors who have been holding.
Drone Delivery Canada, however, continues to be cheap, despite the stock making some impressive progress to its operations over the last few months.
So, you may be wondering, can FLT stock offer the same potential as SCR stock?
Can FLT stock earn returns like SCR?
Drone Delivery Canada is an incredible opportunity for investors, especially if you’re willing to hold the stock long term. As of Monday’s close, FLT stock had a market cap of just $285 million. That’s incredibly cheap, especially when you consider the potential that drones have.
Since 2014, the company has been working to build the operations and work out all the kinks of its drone business. This includes working with several pilot partners and running numerous tests to receive the licences and registration it needs to operate.
And over the years, FLT stock has found numerous applications for its drones, expanding its markets substantially. This is why I think the stock could actually be worth more than SCR one day.
Drone Delivery Canada sees potential for its drones in industries such as healthcare, serving remote communities, working at airports, as well as in oil and gas and many more.
The company has already signed an exclusive agreement with Air Canada and just this morning announced another new deal, this time with Nexeya Canada for military applications.
It’s clear that the multiple avenues of growth for FLT stock give it tonnes of growth potential over the long term. While using drones to deliver goods is already a massive industry, it’s only the tip of the iceberg.
And over time, as the company gains more experience, I’d expect it to continue to improve on its drone technology, which should only help add more potential industries FLT stock can serve.
So, not only do I think Drone Delivery Canada has the potential to grow rapidly like SCR stock, or even get taken over, but I think the company has the potential to continue to expand its operations for years to come, making it one of the top growth stocks to buy now.
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 Daniel Da Costa has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.