2 TSX Food Stocks To Stock Up This Spring!

The food and beverage industry is the second largest manufacturing industry in Canada and contributes to the country's economy in a significant way. This industry accounts for 17 per cent of total manufacturing and 4 per cent to the national GDP.

In the last 12 months, the food sector was affected badly due to high volatility in the markets caused by the COVID-19 situation. However, as vaccines are get rolled out and businesses return to normalcy, this sector is expected to grow. This can further lead to a boost the country's economy.

In this article, we'll talk about the top two food stocks you might lookout for this year: 

MTY Food Group Inc. (TSX: MTY)

Headquartered in Montreal, this company is a franchisor and operates several casual dining and quick service restaurants, which operate under more than 70 brand names. It has a presence in Canada and the US and generates highest revenue from Canada.

It has a market cap of C$ 1.4 billion and holds a P/B ratio of 2.4. The stock prices grew up by 145 per cent in a year and 6 per cent year-to-date (YTD).

The company’s cash flows from operating activities reached C$ 44.8 million fourth quarter 2020, up by 18 per cent in the previous quarter. Adjusted EBITDA decreased 18 per cent year-over-year (YoY) to C$ 35.2 million.

However, due to the COVID-19 restrictions (second wave), the system sales went down to C$ 891.4 million, down by 13 per cent YoY.

On the other hand, digital sales went up and reached C$ 193 million in Q4 2020, up by 133 per cent in Q4 2019. 

SunOpta Inc. (TSX: SOY)

This is a Canadian company that focuses on healthy food and beverages products that are either plant or fruit based, popularly knowns a meat-substitutes. SunOpta Inc. is based out of Ontario, Canada and it had a good presence in the US, from where majority of revenue comes.

The stock for this company is doing well, advancing by 657 per cent in a year and almost 28 per cent YTD. SunOpta has a market cap of C$ 1.9 billion and it offers a 38.5 per cent return on equity.

Its revenues increased by 10.4 per cent in the fourth quarter (ended January 2, 2021) to reach US$ 205.6 million in Q4 2020.

The gross profit for the company was US$ 31 million in Q4 2020, up by 43 per cent in Q4 2019.

The company will be added to the S&P/TSX Composite Index prior from Monday, March 22.

The above constitutes a preliminary view and any interest in stocks should be evaluated further from an investment point of view.