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These small Canadian companies show strong revenue growth

RYAN GOTTSCHALK Tuesday, June 16, 2015 What are we looking for? Companies trading on the TSX Venture Exchange that are reinvesting capital back into their respective businesses and have seen strong revenue growth over the past year. The screen The TSX Venture Exchange is brimming with early-stage companies who seek financing, many of whom go on to become successful ventures and offer large returns for investors who are able to take on the additional risk. We look for companies that displayed a capital-expenditure-to-total-asset-value ratio of at least 30 per cent in 2014, and have seen incremental revenue growth of at least 10 per cent over the 2014 calendar year. These metrics look to identify companies that are beginning to see the after-effects of large capital investments and are poised to take off as they become sustainable revenue generating entities. More about Thomson Reuters Thomson Reuters delivers trusted news and intelligent information to over 1 billion people in 140 countries every day. Our content, software and technology support the way professionals work in a rapidly changing, ever more complex world. Thomson Reuters Eikon is the platform used by financial and corporate clients to access top research, portfolio analytics, charting and screening for every asset class. What did we find? The screen yielded 13 results across three sectors, the majority of which come from the energy sector. Ikkuma Resources Corp.is an oil and gas exploration company that appears to be more heavily discounted relative to its peer group. The company has immense infrastructure already in place and has the capacity to greatly expand operations in the coming months. Tribute Pharmaceuticals Canada Inc.is a company that focuses primarily on the acquisition and development of health-care products in Canada and has recently become the target of an acquisition of by Pozen Inc. The byproduct of the deal will be the creation of a new entity called Aralez Pharmaceuticals, a company that is expected to be established by year end and will offer a broad product portfolio built through prior capital expenditures. Aurora Spine Corp. has also seen substantial revenue growth due to proprietary medical devices that looked poised to deliver to a niche medical market. The company is awaiting FDA approval, which will allow it to enter the U.S. market and see substantial sales growth. Investors should conduct further research before investing.