- Amid this worldwide IPO frenzy, in case you have missed the TSX debutants, there is still a chance to get hold of a few stocks.
- Pet Valu (TSX:PET) stock could be a smart investment option as the pet care industry is estimated to grow in Canada.
- Anaergia (TSC:ANRG) stock prices might increase in future as it is committed to the strategy of environment, social and corporate governance.
Like the global equity markets, Canadian markets have witnessed a series of initial public offerings this year. In the first half of 2021, the markets saw 88 IPOs and raised C$ 6.92 billion, according to a report released by intelligence firm CPE Analytics.
The multinational professional services firm Ernst & Young notes that the public debut frenzy is a global phenomenon and the gross proceeds from global IPOs have catapulted by 215 per cent year-over-year (YoY). In addition, the second quarter of this year was the best performing quarter for global IPOs since 2001.
Getting hold of pre-IPO shares is not an easy task. Potential investors mostly get leftover shares as most of the common shares are first allotted to the institutional investors. However, that does not mean that an investor cannot make gains if one cannot get hold of the pre-IPO shares.
On that note, we have shortlisted two stocks that were listed recently on the Toronto Stock Exchange (TSX). In case you have missed these stocks, it seems there is still a chance to make gains and you might consider exploring them:
Pet Valu Holdings Ltd. (TSX:PET)
Since this pet care company has been in the business for 45 years, investing in Pet Valu Holdings could be a smart option. The COVID-19 pandemic has increased pet adoptions in Canada and according to the Canadian Animal Health Institute, the number of dogs as household pets increased to 7.7 million in 2020 and cats outnumbered them as there were 8.1 million household cats.
The Canadian pet food market alone is expected to grow at a compound annual growth rate of 4.3 per cent between 2021 to 2026, according to a Mordor Intelligence report.
Pet Valu has 609 stores across Canada and this figure might increase up to 644 this year. On June 24 this year, PET stock started trading at the TSX and opened at C$ 24 per share. Ever since then the stock has traded between C$ 24 to C$ 28 and at market close on July 27, the stock was priced at C$ 26.27 per unit.
In 2020, the pet care company had recorded increased revenues of C$ 648 million and this could further increase this year as the animal care sector is expected to grow rapidly in the coming years.
Last year, Pet Valu's net income was C$ 29 million, representing an increase of four per cent year-over-year (YoY). In addition, the free cash flows increased to C$ 109 million, reflecting an increase of 76 per cent YoY.
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Anaergia Inc. (TSX:ANRG)
Committed to environmental, social, and corporate governance (ESG), Anaergia's business operations are based on protecting the environment by converting waste into useful resources. Investing in ANRG stock could help secure gains in the long run as demand for such stocks might increase in future as people become more conscious of the environment.
Canada and other countries committed to fight climate change are looking to reduce the emission of greenhouse gases. Anaergia's innovative technology could boost the company's growth prospects as it claims to eliminate GHG emissions by converting almost any type of waste into clean water and other by-products like renewable natural gas and fertilizers.
ANRG stock began trading on June 18 this year and the shares opened at C$ 13.93 and touched a high of C$ 20.3 apiece on July 21, 2021.
The closing price of Anaergia shares was C$ 18.21 per share on July 28 and the prices could soar further as the company might gain investors attention due to its environmentally conscious business strategies.
In 2020, Anaergia's revenues were C$ 128 million, up by 42 per cent in 2019. Meanwhile, the adjusted EBITDA was C$ 3.1 million in 2020 and the company expects it to reach between C$ 50 million to C$ 60 million in 2022.
A report by Mordor Intelligence notes that the global waste management industry was valued at US$ 383.8 billion in 2020. Till 2026, this industry is projected to register a CAGR of five per cent.
The waste management industry is expected to grow in future as countries look to find waste management solutions and develop a sustainable economy by reducing pollution. Since Anaergia is developing innovative technologies, the company seems to have the potential to grow rapidly in the next few years.