3 Top Growth Stocks Trading Below $5 to Buy This October
The Motley Fool
Published Oct 20, 2021 09:42
3 Top Growth Stocks Trading Below $5 to Buy This October
Investing in lower-priced growth stocks remains an attractive option, as it allows portfolio diversification with a small amount of capital. For example, instead of buying one share of Amazon (NASDAQ:AMZN) for over $4,000, you can purchase shares of several companies trading below $5. While this strategy carries significant risks, it also allows investors to generate stellar gains over time. Here, we take a look at three such growth stocks that Canadians can look to buy this month.
4Front Ventures A U.S.-based cannabis stock flying under the radar, 4Front Ventures (CNSX:FFNT) is a small-cap company valued at $753 million. It has increased sales from US$4 million in 2018 to US$57.63 million in 2020. Analysts expect sales to rise by 271% year over year to US$213.8 million in 2021 and by 41.6% to US$303 million in 2022. The company’s adjusted earnings are also forecast to improve to US$0.16 per share in 2022 from a loss per share of US$0.08 in 2020.
In Q2 of 2021, 4Front Ventures revenue rose 85% year over year to US$34.4 million. Comparatively, adjusted EBITDA increased by 27% sequentially to US$7.5 million, indicating a margin of 22%.
4Front reiterated systemwide pro forma revenue of between US$170 million and US$180 million in fiscal 2021 with an adjusted EBITDA of between US$40 million and US$50 million. It emphasized that existing licensed projects at maturity represent a long-term revenue and EBITDA opportunity of over US$650 million and US$250 million respectively.
HIVE Blockchain For investors bullish on the cryptocurrency space, HIVE Blockchain (TSXV:HIVE)(NASDAQ:HVBT) is a company that should be on your radar. Priced at $4.5 per share and valued at a market cap of $1.73 billion, HIVE stock is up a massive 4,620% since the start of 2020. So, a $1,000 investment in HIVE in January 2020 would be worth more than $47,000 today.
In the first quarter of fiscal 2021 ending in June, HIVE’s gross revenue from digital currency mining stood at $37.2 million, an increase of 466% year over year. It was also 11% higher on a sequential basis.
This allowed the company to report a net income of $18.6 million, up from just $1.8 million in the year-ago period. HIVE’s gross mining margin expanded to $31 million in Q2 from $2.6 million in the year-ago period. Investors should know that the stock price of crypto mining companies such as HIVE is closely related to the digital asset they mine, making the shares as volatile as their underlying assets.
Columbia Care The final stock on my list is another cannabis company with a huge presence south of the border. Shares of Columbia Care (CNSX:CCHW) are priced at $4.34, valuing the company at a market cap of $1.58 billion. While the stock has gained over 70% in the last 18 months, it also traded 55% below all-time highs.
Get The App
Analysts expect Columbia Care to increase sales by 248% to US$625 million in 2021 and by 55.4% to US$971 million in 2022. This rapid expansion in the top line will also allow the company to report adjusted earnings of US$0.3 in 2022 compared to a loss of US$0.48 in 2020.
It’s now one of the largest multi-state operators in the U.S., with 99 dispensaries and 31 cultivation facilities in the country. Columbia Care also has licenses to operate in 18 states where medical marijuana is legalized. Analysts expect shares of Columbia Care to more than triple over the next 12 months.
The post 3 Top Growth Stocks Trading Below $5 to Buy This October appeared first on The Motley Fool Canada.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Fool contributor Aditya Raghunath has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon. The Motley Fool recommends the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon.
This Article Was First Published on The Motley Fool
Written By: The Motley Fool
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.