2 Under-the-Radar Stocks With Massive Growth

A new entry to the 2021 top performers list and a two-time TSX30 winner are great year-end buys for growth investors.

| More on:
A stock price graph showing growth over time

Image source: Getty Images.

Many TSX stocks fly under the radar despite their massive growth or enormous upside potentials. A new and former TSx30 winner should be on your watchlist if you’re scouting for great year-end buys. Now is your chance to snag Aya Gold & Silver (TSX:AYA) and Village Farms International (TSX:VFF)(NASDAQ:VFF) because the stocks won’t be trading at ridiculously cheap prices in 2022.

New TSX30 winner

Aya Gold & Silver is a new entrant to the TSX30 high-growth stocks list in 2021. The $1.01 billion explorer and developer of base metals ranked 12th in the third edition of TMX Group’s prestigious flagship program. It joins top-ranked Aura Minerals and 12 other peers in the mining industry.

The mining stock’s rise from obscurity is fantastic. Its total return in three years is 336.96% (63.19% compound annual growth rate). At $10.05 per share, the trailing one-year price return is 225.24%, while the year-to-date gain is 161.04%. Had you invested $5,000 on year-end 2020, your money would be worth $13,051.95 today.

Management’s investment invitation focuses on five items. Aya is the only pure-play silver producer on the TSX with near-term projected production growth. Apart from the compelling value opportunity, the company has high-grade expansion potential. Last, it has a seasoned management team.

All of the mining activities (exploration, development, production, acquisition) of Aya are in the Kingdom of Morocco. In Q3 2021, the company reported stellar operational and financial results versus Q3 2020. The total silver production and sales increased 198% and 396%, respectively. Revenue growth was 350%.

In the nine months ended September 30, 2021), revenue grew 509% versus the same period in 2020. Notably, Aya is back to profitability. Its operating income and net earnings reached $5.47 million and $2.35 million. The losses a year ago were $5.28 million and $3.41 million.

The significant highlight after three quarters is the 844% turnaround in operating cash flows to $15.85 million. Also, it was the fourth consecutive quarter that Aya reported net profits. The mining company was in the red in the quarters ended December 31, 2019, up to September 30, 2020.

Bullish sentiment

Village Farms is a two-time TSX30 member (2019 and 2020), although it underperforms year to date (-25.52%). Nevertheless, market analysts are bullish on the stock and recommend “buy” to “strong buy” ratings. Their 12-month average price target is $21.34, or a return potential of 122.29%.   

Most cannabis producers, including industry leaders, continue to report quarterly losses instead of gains. However, Village Farms is an exception. In Q3 2021 (quarter ended September 30, 2021), net income even rose 43% to $745 million compared to Q3 2020.

Village Farms’ growth drivers are Pure Sunfarms and Balanced Health Botanicals (BHB). The latter is newly acquired and is a profitable Colorado-based CBD platform. BHB gives VFF immediate entry into the CBD market, a consumer products category, and the consumer-packaged-goods (CPG) wellness space.

Furthermore, Village Farms entered an option agreement recently where it could acquire 80% of Netherlands-based Leli Holland B.V. in the Netherlands. The company is upbeat about the future prospects for the controlled environment agriculture produce industry and ready to capitalize on the opportunities.

High growth stocks

Aya Silver & Gold and Village Farms are high-growth stocks for their astronomical returns. The chances of them making it together to the fourth TSX30 edition in 2022 are high.

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 recommends TMX GROUP INC. / GROUPE TMX INC.

More on Metals and Mining Stocks