The sudden spikes and dips of the TSX to start the second half of 2022 is proof of the heightened market volatility. While many investors are consumed by recession fears, others will continue to buy on weakness, particularly in emerging sectors or industries.
The likes of Brookfield Renewable Partners (TSX: BEP.UN)(NYSE: BEP), Converge Technologies (TSX: CTS), and Verde Agritech (TSX: NPK) are buying opportunities for their visible growth potential. A massive future windfall is possible if you take early positions in one or all today.
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Growing demand for clean energy
Brookfield Renewable Partners has been a steady performer thus far in 2022. At $47.48 per share, current investors enjoy a 6.71% year-to-date gain in addition to the 3.48% dividend. According to Forbes and some experts, renewable energy is one of the emerging, if not fastest-growing industries.
The $30.47 billion company operates pure-play renewable power platforms or portfolio that consists of hydroelectric, wind, and solar energy sources. It also has storage facilities. Besides North America, Brookfield Renewable is present in South America, Europe, and Asia.
More importantly, Brookfield Renewable is the flagship-listed renewable power company of capital-rich Brookfield Asset Management. Management said its cash flows are highly resilient due to the diversified portfolio of operating assets, limited concentration risk with counterparties, and a long-term contract profile.
The company is also confident that inflation and supply chain pressures will not cause a slowdown in the adoption of clean energy globally. Wind and solar energy are the cheapest forms of bulk electricity production that are not subject to variable input costs.
Another potential upside for the business is the projects in the pipeline. Brookfield expects demand for clean energy to keep growing. It should increase the value of its high-quality, ready-to-build projects.
IT services focused
Converge Technologies underperforms, like its sector peers, although the company is well positioned for solid organic growth. At $5.80 per share, the tech stock is down 46.64% year to date. However, market analysts covering the stock recommend a buy rating. Their 12-month average price target is $11.56 (+99%).
The focus of this $1.24 billion firm is the IT services industry, while the target clients are mid-market customers or small to medium businesses in North America and Europe. Apart from doing IT outsourcing, Converge acquires new companies and intensifies cross-selling activities through new services that includes high-margin, managed services.
Its CEO, Shaun Maine, said demand was extremely strong in Q1 2022. While the net loss for the quarter was $2.4 million, total revenue jumped 77% year over year to $550 million. Due to the improvement in the supply chain, product orders reached approximately $575 million.
Unstoppable momentum
Verde Agritech is the TSX’s top price performer for most of 2022. At $7.68 per share, the trailing one-year price return is 668%, while the year-to-date gain is 174.29%. Market analysts covering NPK expects the upward momentum to continue. They see a 146% return potential, on average, in 12 months.
The $398.58 million fully integrated agricultural technology company operates in Brazil and produces potash fertilizers. Management expects its newest technology, Bio Revolution, to be a game changer and growth catalyst.
Exciting prospects
Brookfield Renewable Partners, Converge Technologies, and Verde Agritech are exciting and profitable picks for growth investors in August 2022.
