Bombardier, BlackBerry and Hexo: 3 trending stocks under C$8

Summary

• Potential to return good yields in the long run continues to keep discounted shares in demand among investors.
• We look into three companies — Bombardier, BlackBerry and Hexo — that are currently trading under C$8.
• While Blackberry shares have been trading flat in the last three months, Bombardier and Hexo have seen a decline.

As the coronavirus continues to impact the stock market, investors are turning to shares that are either standing tall in the face of the pandemic or former top stocks that are now available at a low price. This has led to heavy volume activities for companies like Bombardier, Blackberry and Hexo. Currently trading under C$8 per share, these shares saw a drop in price as the pandemic set in March and haven’t quite been able to recover yet. The potential to return good yields, however, continue to keep them in demand among investors. Here, we analyze the stock of these companies and provide you with a little more detail about their performance in recent times.

Bombardier Inc (TSX:BBD)

Stock Price: C$0.41

Plane and train manufacturer Bombardier saw a sharp fall in its share value around mid-March as the coronavirus pandemic set in. This came as added trouble for the company, which was already struggling with massive debt from its botched CSeries aircraft business. Bombardier announced the sale of the commercial jet to Airbus and its train business to French rail manufacturing company Alstom SA in February. Meanwhile, its aerostructure business is expected to be purchased by Spirit AeroSystems Holdings in fall.

Bombardier has been restructuring its business model to align with ongoing COVID-19 crisis, which has led to a substantial reduction of workforce. In its second quarter report, the company announced that its consolidated revenues were at US$ 2.7 billion, down 37 per cent year-on-year, while its adjusted earnings before interest and taxes (EBIT) stood at a loss of US$ 427 million. On August 19, it announced the closure of its three-year US$ 1.0 billion senior secured term loan.

Bombardier has a market capitalization of C$ 861 million at the moment and its share has seen a decline of 6.8 per cent in the last three months.

Now solely dealing with the manufacture of private business jets, Bombardier delivered the first Global 7500 aircraft in August-end.

READ: Bombardier, HEXO & Aphria: 3 stocks under C$6 set to boost your investment

BlackBerry Limited (TSX:BB)

Stock Price: C$7.06

BlackBerry lost its coveted stage of being one of the world’s top smartphone makers over a decade ago. However, after losing out to Samsung and Apple’s slick devices, it turned to expand on the feature its handsets were recommended for – software security.

The cybersecurity giant recently announced the completion of its debt financing, with the redemption of its 3.75 per cent unsecured convertible debentures.

Meanwhile, as the company’s share value continued to take a hit amid the COVID-19 pandemic, BlackBerry’s phone business ended its partnership with Chinese company TLC. A Texas-based startup, OnwardMobility, is now set to launch a new range of 5G phones in collaboration with Blackberry and Foxconn subsidiary FIH Mobile. These 5G phones under BlackBerry’s brand will be released in the market in the first half of 2021.

Blackberry shares have been trading flat in the last three months and its current market cap is at over C$ 3.9 billion.

READ: BlackBerry & Absolute Software: Two Tech Stocks With Cybersecurity Exposure

Hexo Corp. (TSX:HEXO)

Stock Price: C$0.90

In the last three months, Hexo’s shares have gone down by 6.1 per cent, yet they continue to be in demand among investors. In August 2020, the cannabis company announced the completion of its at-the-market equity program where it sold over 33 million common shares, making total gross proceeds of about C$ 34.5 million. Currently, its 10-day trading volume stands at 1,185,270 and its market capitalization is C$434 million.

In a bid to control cost and tackle the coronavirus-triggered challenges, the pot firm sold off its Niagara facility in June, leading to a reduction of workforce and production. In April, Hexo also received a delisting notice from the New York Stock Exchange (NYSE) for its shares running below the required US$1 listing price for a long time. The pandemic, however, led to the company getting an extension till December to pull up its socks and meet the required listing price.

With the arrival of Cannabis 2.0, which sees edible and ingestible cannabis products in market, Hexo launched its line of vapes across Canada. Meanwhile, the company also introduced its medical cannabis products in Israel in July.

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In its third fiscal quarter 2020 financial results, HEXO’s gross revenue increased 30 per cent year-over-year to C$ 30.9 million, while net revenue surged 30 per cent YoY to C$22.1 million from C$ 17 million in Q2 last year.