About a year ago was the bottom of the COVID-19 market crash (March 23, 2020). It was a very fateful day where the maximum amount of margin selling hit the street and prices were at their lowest.
So it is instructive to run a stock screen and find out which stocks have NOT risen over the past year. We get the following (I’ve limited it to those with a market cap of above $50 million):
Over 50% loss:
Just Energy – JE (they’re still trading in the USA for US$1.78 a share, but in today’s topsy-turvy world where Hertz is still over a dollar, maybe bankruptcy will be good for their common stock!)
Medipharm – LABS
Calfrac Well – CFW
BELLUS Health – BLU
30-50% loss:
Helix BioPharma – HBP
AKITA Drilling – AKT.b
Aptose Biosciences – APS
Oryx Petroleum – FORZ
Wall Financial – WFC
20-30% loss:
None
10-20% loss:
Nighthawk Gold – NHK
Patriot One – PAT
Morguard – MRC
Transat – TRZ
Postmedia – PNC.b
Shore Gold – DIAM
Noranda Income Fund – NIF.UN
Resverlogix – RVX
Tetra Bio Pharma – TBP
0-10% loss:
Trilogy International – TRL
Currency Exchange – CXI
VIVO Cannabis – VIVO
Knight Therapeutics – GUD
Metro – MRU
Aurinia Pharma – AUP
Invesque – IVQ.u
Loblaw – L
Casual observations
A lot of biotechs in the list, and then seconded by some oil drillers.
The names that stick out at me are Morguard (perennially trading well under book), but this is not my typical type of investment. There might be a time for them to shine once again – when you mention “perpetually trading under book value”, E-L Financial comes to mind (TSX: ELF) and even they have received a tailwind recently. I also note two of the major grocery chains are on this list (albeit with minor amounts of changes for the year), but these companies are well known, well valued and quite frankly not interesting. In the smallcap realm, Currency Exchange is a very odd business which got my attention during COVID as a travel recovery stock, but for various reasons I declined to pursue it.
This post prompted me to take a look at Morguard’s chart – still down >40% from late Feb 2020. Meanwhile, looks like TSX equal-weight REIT index recovered to >85% of pre-covid (with higher distributions than Morguard in the process). Might be something here, unless their retail/office holdings are seriously impaired or their debt levels not sustainable.
I wouldn’t fault somebody for parking cash into them at these valuations, as long as they can accept riding on Sahi’s coattails (not a criticism of him, just acknowledging it is a controlled company situation with plenty of subsidiaries and the related-party issues that come with them).
Hi Sacha, any thoughts on Rogers – Shaw deal and whether its going to be approved?
I can hardly imagine Trudeau stopping it from happening, given both families have approved the deal, but surprisingly Mr. Market currently assesses the probability at ~50%, given that only half of the purchase premium has been priced in Shaw’s share price (33 MV vs 40.5 per deal).
Would love to hear more about the various reasons you declined to pursue CXI :)!