The confidence of investors, both local and foreign, in the S & P / TSX Composite Index is very high in 2021. The main Canadian stock index could end the year with a new record if the upward trend continues. Due to the global economic recovery and rising commodity prices, the median forecast for portfolio managers and strategists is 20,500 at year-end.
A Reuters poll results also reveal that the TSX could top 21,750 by the end of 2022. Currently, the drivers of growth are the rollout of the COVID-19 vaccine, the historic low interest rate, and increased household savings. The fiscal stimulus could be sustained depending on the growth of the working population.
Meanwhile, Canadians have great opportunities to make money. High potentials Vermilion Energy (TSX: VET) (NYSE: VET) in the energy sector and Organizational chart (TSX: OGI) (NASDAQ: OGI) in the cannabis business could double a $ 5,000 investment. Both are low cost stocks with huge growth potential.
Back to normal
Vermilion Energy investors are delighted with the stock’s 84.51% gain since the start of the year. Plus, at $ 10.48 a share, the Energy stock is among the undervalued stocks today. The turnaround is here for this $ 1.67 billion Calgary oil and gas producer.
Vermilion successfully recovered its net loss of $ 1.1 billion in the first quarter of 2021. In the first quarter of 2021 (March 31, 2021 quarter), management reported net income of $ 499.99. The turnaround is here now that the prices of crude oil and natural gas, the dominant commodities, continue to rise.
The company’s operations in North America, Western Australia, Croatia, France, Germany, Hungary, Slovakia and the Netherlands are expected to return to normal soon. Expect a revitalization of drilling operations for the remainder of 2021. Once normalcy returns, Vermilion’s free cash flow driven business model would once again be fully visible.
All of Vermilion’s operating regions have been generating free cash flow for years. The main strengths, if economically justified, are high margins, low rates of decline and high capital efficiency.
Vermilion recognizes the impact of fluctuations in commodity prices, interest rates and exchange rates. The company mitigates risk by hedging. It enters into fixed price agreements in the normal course of business and sells part of its production.
OrganiGram has plenty of room to soar despite gaining 113.02% year-to-date. Market analysts also recommend a buy rating for the obscure weed stock. They predict that the current share price of $ 3.60 will climb 65% to $ 5.95. However, the benefit could be greater once the federal legalization of marijuana in the United States.
Moncton’s $ 1.07 billion company produces high-quality recreational and medical cannabis. OrganiGram is adept at maximizing the interior space of its production plant. The secret is three tier grow technology that will maximize indoor space.
Despite lower revenues and a larger net loss in the second quarter of fiscal 2021 (quarter ended February 28, 2021), weed inventory remains in positive territory. Greg Engel, CEO of OrganiGram, said: “In the shorter term, we currently expect to generate higher revenues in the third quarter of 2021 as our new product portfolio continues to gain traction and we become better staffed. to answer the question. “
Another compelling reason to pick up OrganiGram is the significant stake in British American Tobacco. The US $ 89.23 billion tobacco grower’s stake in the Canadian cannabis producer is US $ 175 million. Even though it’s a drop in the bucket for the London-based company, OrganiGram should help them break into the CBD market.
It shouldn’t be long before Canadians look for bargains on the Toronto Stock Exchange. Vermilion Energy and OrganiGram are great buys when they are cheap.
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This article represents the opinion of the author, who may disagree with the “official” recommending position of a Motley Fool premium service or advisor. We are straight! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer, so we post sometimes articles that may not conform to recommendations, rankings or other content. .
Foolish contributor Christophe Liew has no position in any of the stocks mentioned. The Motley Fool owns shares and recommends OrganiGram Holdings. The Motley Fool recommends British American Tobacco.