Stock market report of Québec inc. | Winners and losers of 2022

Hiding places were hard to find in 2022. But there were. All you had to do was “look” in the right places. Here is our overview of the big winners and big losers of Québec inc. on the Toronto Stock Exchange over the past year.

The winners

Supremex

Certainly, few people would have said a year ago that this Montreal company, still little known to the general public, would stand out in 2022 to the point of recording a 110% rise on the stock market. Especially since Supremex specializes in the manufacture of envelopes and packaging products and still derives 70% of its revenue from the sale of envelopes, a declining market. The goal is to quickly build the weight of the business in the packaging sector to hopefully be more valued as a specialist packaging company and appear on the radar of more investors.

Uni-Select

The title of the Boucherville auto parts distributor has just recorded impressive growth for the second year in a row. After a 217% jump in 2021, Uni-Select’s stock rose 65% in 2022. Five of the six analysts who follow the stock are still offering to buy it. The company’s balance sheet is considered to be “sound”, an element highly valued by investors in the current economic context and which allows Uni-Select to be ready to make acquisitions. There could well be announcements in this direction in 2023.

Goodfellow

The Quebec manufacturer of wood products and distributor of building materials, which does not count on any official coverage from analysts, had a year of thunder on the markets. Its stock appreciated 30% in 2022 to push the company’s market value to just over 100 million. The stock had fallen to $3 at the start of the pandemic. It is now worth nearly $13. This family business will celebrate its 125th anniversary in 2023. Montreal investor Stephen Jarislowsky has been a member of Goodfellow’s board of directors for 50 years and is personally one of the company’s largest shareholders.

ADF Group

Au Dragon Forgé (ADF) is another small-cap Quebec stock that has stood out admirably this year. The action of the Terrebonne company also appreciated by 30% in 2022. This specialist in the manufacture of steel superstructures even ended the year on a strong note by announcing in mid-December the signing of a series of new contracts totaling $228 million. This announcement allows the management of the ADF Group to approach the new year with optimism and perhaps to attract the attention of investors. The title remains under the radar since no analyst ensures an official follow-up.

Losers

Goodfood Market

The number of active customers is down. To reassure investors, the number of subscribers to packed lunch deliveries must not only stabilize, but also increase. In order to reduce the risk of running out of cash, Goodfood is reorganizing and in the fall dropped its on-demand grocery delivery service, in addition to consolidating its production in two facilities (Calgary and Montreal). Management still expects to generate adjusted operating profit by the end of February. The action of the Montreal company dropped around 90% of its value in 2022. The title had already lost 66% in 2021.

Hexo

The cannabis stock craze isn’t what it used to be. The Gatineau producer’s stock market tumble continued in 2022 with an approximate decline of 90% during the year. To help reduce losses, jobs were eliminated and products were discontinued. To bring the title back to more than $1 on the stock market, a reverse stock split was carried out in December. The eight analysts who are interested in Hexo are unanimous: it is still not the time to buy.

Guru

The Montreal-based organic energy drink company spends a lot of money on marketing in an effort to increase brand awareness. Unfortunately, investors show little appetite in the current context for small caps whose profitability remains to be demonstrated. The adjustment of the business model put margins under pressure. Pepsi has been handling the merchandising, sales and distribution of Guru products for just over a year. Guru’s stock has lost almost 90% of its value in 2022.

Lion

The second year on the stock market for the manufacturer of 100% electric heavy vehicles, whose head office is located in Saint-Jérôme, was no better than the first. After falling about 40% in 2021, Lion’s stock fell 75% in 2022. The company needs a lot of capital to finance its growth initiatives and hope to eventually become profitable. A securities issue was carried out in the fall and the possibility of even greater dilution awaits investors.