The TSX has been flat over the past two years because of broad investor uncertainty about the effects of inflation.
While the year-over-year figure shrunk to 3.1 per cent in November 2023, down from 8.1 per cent in June 2022, prices still remain high, especially for food, energy and property, as businesses position themselves for an ongoing economic slowdown driven by slumping consumer spending.
One way investors can skirt this near-term uncertainty is by emphasizing quality stocks, whose sound assets and financial performance provide protection against fluctuations in the macro environment.
This week on Buzz on Bullboards, we highlight three such quality stocks well worth a run through your due diligence process.
Gatekeeper Systems (TSXV:GSI; Forum), an intelligence video and data solutions provider to the transportation industry, posted net income of C$2.8 million in 2023, an increase of 50 per cent year-over-year.
The standout results can be attributed to significant growth in the company’s school and transit segments.
During the year, Gatekeeper expanded its installed base of mobile data collectors to more than 50,000 and is actively offering these customers monitoring and data optimization solutions to fortify recurring revenue.
The company is on the verge of consistent profitability, with positive net income in three out of the past five years, and four out of the past five quarters. The broader market agrees, having pushed the stock up by 96 per cent year-over-year and by more than 400 per cent since 2019.
Canada Nickel Company (TSXV:CNC; Forum) has sold a 12 per cent stake in its business to Agnico Eagle Mines (TSX:AEM) for C$34.7 million.
Agnico’s reputation and expertise as the world’s third-largest gold producer will aid Canada Nickel in its efforts to develop its Timmins Nickel District, which houses the C$2.5 billion after-tax NPV8% Crawford Nickel Project, the world’s second-largest nickel reserve and its second-largest resource, including 3.8 million tonnes of proven and probable nickel reserves.
Agnico Eagle’s sizeable investment will expedite Crawford’s development as Canada Nickel ramps up the project to its expected more than C$1 billion in annual revenue over a 41-year life-of-mine. Initial production is slated for 2027.
Despite the attractiveness of Crawford’s recent bankable feasibility study and Canada Nickel having identified 11 targets with a greater footprint than Crawford, which it is fully funded to exploit, CNC shares have lost 22.91 per cent year-over-year and the company has accumulated only C$197 million in market capitalization.
That said, shareholders since inception in February 2020 have been rewarded for their conviction with a 53.33 per cent return, as well as prospects for future gains as new developments reach a wider audience thanks to Agnico’s skin in the game.
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Hercules Silver (TSXV:BIG; Forum) reported assay results for numerous drill holes from the Leviathan Porphyry copper discovery on its Hercules project in Idaho.
The highlight result in HER-23-21 yielded 161 metres of 0.45 per cent copper, 148 ppm molybdenum, and 4.4 g/t silver, including 79 m of 0.53 per cent copper and 7.3 g/t silver.
Step-out holes from the initial discovery, HER-23-05, significantly expand the scale of the mineralized system, with every drill hole to date across a 450 m x 500 m area ending in mineralization.
A preliminary property-wide deep-penetrating IP survey also reveals the potential for a much larger mineral footprint than previously thought.
Backed by a recent C$23.3 million investment from Barrick Gold (TSX:ABX), the company is focused on drilling a new multi-km IP anomaly in search of the mineralized system’s potentially high-grade core.
Hercules Silver stock is up by 364.7 per cent year-over-year and by 690 per cent since inception in March 2021.
Regardless of the broader stock market’s short-term, manic-depressive swings, long-term value creation will always prevail in the end and serve as the ultimate driver of portfolio returns. Focusing on quality stocks, like the three we’ve introduced this week, is one of the most dependable ways to harness the market to meet your financial goals.
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