Gain insights from studying some of the biggest TSX stock movers from yesterday. Let’s see what they can tell us about potential big movers.
Why this small-cap stock jumped 185% in a day
Small-cap Trillium Therapeutics (TSX:TRIL)(NASDAQ: TRIL) stock made a massive jump of 185% on the TSX and 189% on the NASDAQ yesterday. The reason was simple: Pfizer agreed to acquire the biotech company for the shares that it did not already own at US$18.50 per share. This implies there’s still about 5% upside to reach Pfizer’s buyout price.
Pfizer believes that the acquisition will strengthen its leadership in oncology, as Trillium Therapeutics is a clinical-stage immuno-oncology company that develops innovative therapies to treat cancer. Particularly, management believes that Trillium Therapeutics could expand its innovative pipeline and potentially augment its growth further down the road for five to nine years later.
Drug manufacturer Pfizer is really paying above and beyond for the small cap, which the Street believed was worth about US$11 per share. Time will tell if Pfizer made the right decision.
This energy stock popped 20% on Monday
Oil and gas producer Crew Energy (TSX: CR) investors happily saw their shares appreciate more than 20% on Monday. There was no news about the energy stock, though. The abnormal jump could simply be a delayed response to its positive second-quarter (Q2) results that came out at the start of the month. After all, small-cap stocks are not followed as closely.
In the Q2 financial results, management highlighted the strong 451% boost in adjusted funds flow. Looking at the bigger picture, its adjusted funds flow jumped 249% in the first half of the year (H1) to $59.5 million.
It appears that Crew Energy smartly chose to curb its petroleum and natural gas sales in the onset of the pandemic last year when energy prices were low. Therefore, we saw a strong rebound in the company’s sales and adjusted funds flow in H1 2021. Specifically, sales appreciated 145% to $154 million and its adjusted funds flow per share rose by 236% to $0.37.
The energy stock could climb another 40% over the next 12 months if energy prices cooperate.
This tech stock has outperformed for long-term investors
Tecsys (TSX: TCS) appreciated 10% on Monday. Similar to Crew Energy, small-cap Tecsys had no recent company news. Its last press release came out early this month. It was about Indiana-based Parkview Health deciding to use more of Tecsys’s services — this time, using Tecsys’s supply chain management system for its pharmacy operations.
Tecsys’s fiscal year ends at the end of April. Therefore, the supply chain management software-as-a-service (SaaS) company last reported its fiscal 2021 results at the end of June.
For the fiscal year, it saw revenue growth of 17% to $123.1 million — specifically, cloud, maintenance, and subscription revenue had stronger growth of 29% to $52.9 million, making up 43% of total revenue versus the prior year’s 39%. Gross profit was 20% higher at $60.6 million, while the adjusted EBITDA, a cash flow proxy, was boosted by 58%.
The stock was probably too cheap before as it had a 38% correction this year from peak to trough. The tech stock has a strong execution history, as one of the best-performing stocks among the Canadian Dividend Aristocrats with 10-year stock price returns of close to 38% per year. Investors who bought shares at about $40 in the recent dip were handsomely rewarded.
