In case you are looking to invest in lower-priced stocks right now, companies such as Goodfood (TSX:FOOD), 4Front Ventures (CNSX:FFNT), and Columbia Care (CNSX:CCHW) remain attractive buys. Each of these stocks is priced below $10 and should provide investors with significant opportunities to beat the market over the long term.
Goodfood Market stock has tripled since its IPO
A company valued at a market cap of $790 million, Goodfood has managed to increase its sales from $70.5 million in fiscal 2018 to $285 million in fiscal 2020 that ended in August. This robust top-line growth has also allowed the company to narrow its operating loss from $9.4 million to $2.56 million in this period.
The COVID-19 pandemic acted as a massive tailwind for Goodfood as demand for its meal kits increased at a stellar pace. Analysts tracking the stock expect it to increase sales by 37% to $391 million in fiscal 2021 and by 13.7% to $445 million in 2022. At the end of fiscal Q3 of 2021, Goodfood had a customer base of 317,000, a rise of 17% year over year.
In Q3, the company’s revenue soared by 24%, while gross profit was up 51% year over year. Goodfood remains a top small-cap growth stock and has already returned 200% since it went public in April 2015.
The rapidly expanding addressable market for cannabis producers in North America makes 4Front Ventures a solid bet for growth investors. 4Front Ventures is valued at a market cap of $960 million and this marijuana grower is focused to leverage its low-cost cultivation and distribution techniques to gain market share in a nascent but competitive industry.
4Front Ventures has a sizeable presence in Washington, where it is the second-largest cannabis producer in terms of market share. Currently, it operates in five states south of the border, providing the company access to 76 million potential customers.
Similar to other cannabis companies, 4Front Ventures is also growing its top line at an enviable rate. Its sales have increased from US$4 million in fiscal 2018 to US$57.6 million in 2020. Wall Street expects sales to touch US$169 million in 2021 and US$239 million next year. This will also allow 4Front to improve its bottom line from a loss per share of US$0.08 in 2020 to earnings of US$0.12 in 2022.
The final stock on my list is another cannabis producer Columbia Care that’s currently trading at a market cap of US$1.36 billion. The marijuana operator has licenses in 18 jurisdictions in the United States and European Union.
In Q2 of 2021, the cannabis giant more than tripled its sales year over year to US$109.7 million, while its gross profit quadrupled to US$47.7 million. Columbia Care’s gross margin in fact rose to 43% in Q2, up from 36% in the year-ago period.
This allowed the company to report an EBITDA profit of US$16.4 million compared to a year-ago loss of US$4.7 million. Columbia Care expects revenue to range between US$500 million and US$530 million in 2021, while adjusted EBITDA is forecast between US$95 million and US$105 million.
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 Aditya Raghunath has no position in any of the stocks mentioned. The Motley Fool recommends Goodfood Market Corp.