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Small speculative stocks reviewed by Bizworld lost ground last year

Five of the eight stocks covered in Bizworld reviews last year gained value while three declined.
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Bizworld by Ron Walter

Five of the eight stocks covered in Bizworld reviews last year gained value while three declined.

On average these smaller stocks declined 8.1 per cent each compared with a 21.7 per cent gain for the Toronto Stock Exchange composite index.

The declines reflect the folly of investing in hot story stocks without a track record.

Largest decline was 71 per cent to 21 cents by dynaCERT, the maker of a hydrogen fuel bolt-on for diesel engines.

During the process of commercializing the product dynaCERT discovered a flaw requiring a redesign and lost a sale of nearly 1,000 units. The new design and sales should be on the market by June.

The unit seeking to reduce nitrous oxide and particulate emissions in trucks, mines, trains and ships pays for itself in fuel savings on trucks in one year.

Helium explorer Imperial Helium dropped 49 per cent to 19 cents as news on progress dried up.

Imperial has 95 square miles of leases in the Steveville natural gas field in the Alberta badlands. With two wells drilled, production should be available by spring with construction of a processing plant.

Opera Inc., the Norwegian-based equivalent of Google for Africa and part of Asia, lost 43 per cent to $7.06. The price decline came in the face of 30 million less users, mostly from India.

The company still has 350 million users worldwide with double digit increases in revenues and earnings. The stock sells at 8.5 times earnings, cheap by most standards.                                                                                                                                                               

Royal Helium, one of the Saskatchewan helium explorers, fell four per cent to 48 cents. Royal has leases on 860,000 acres in southern Saskatchewan in the Climax and Ogema regions. The company has drilled two wells in each region with plans for one in early 2022.

With $11 million in cash this speculative stock could bounce high on good news.

Growing pet store chain Pet Valu gained 33.6 per cent to $36.07 on the path to double store count to 1,200 over several years. Revenue was up 36 per cent with profits up 100 per cent.

Neighbourly Pharmacies’ stock increased 33.1 per cent to $39.94 as the company continued to buy out small pharmacies adding 40 in 12 months.

Revenue was up 54 per cent to the end of September but it was still not profitable.

Award winning Nanalysis Scientific Corporation gained 24 per cent as it develops a market for MRI units and MRI-related products. These MRI units don’t need helium as a coolant.

Crescent Point Energy gained 14.3 per cent to $6.75 since a review late last fall. 

The oil producer, with interests in southern Saskatchewan, Duvernay, Alberta and North Dakota, produces 122,000 barrels of oil equivalent per day.

Crescent Point is paying down debt to get out of the penalty box it was thrown into when debt expanded too much. The price to earnings ratio is low — less than two times.

CAUTION: Remember when investing, consult your adviser and do your homework before buying any security. Bizworld does not recommend investments.

Ron Walter can be reached at ronjoy@sasktel.net

The views and opinions expressed in this article are those of the author, and do not necessarily reflect the position of this publication.