The TSX has been on a rebound, clawing back to levels seen before the great global selloff that marked the beginning of the month. As the market stabilizes, investors are keenly watching certain TSX-listed stocks that have recently faced setbacks but are striving to regain their former momentum.
Each company has made recent headlines with their respective news and developments. The big question: Will they succeed in turning things around?
Brewing a new future
Tilray Brands Inc. (TSX:TLRY, Forum) has been making bold moves to expand its footprint in the craft beer market, recently signing an agreement to acquire four breweries from Molson Coors (NYSE:TAP, Forum). The deal includes Hop Valley Brewing Company, Terrapin Beer Co., Revolver Brewing, and Atwater Brewery. This acquisition is expected to expand Tilray’s beer portfolio across key markets, adding a 30 per cent increase in new beer-buying accounts, potentially paving the way for substantial revenue growth.
What the “Buzz”
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Adding to its momentum, Tilray’s subsidiary, Shock Top, made history by partnering with the University of Florida Athletic Department, marking the first craft beer sponsorship for Gators Athletics. The partnership will kick off with the 2024 football season, introducing a special edition co-branded Shock Top craft brew tailored for Gators fans. This initiative promises to enhance brand visibility and customer engagement, setting the stage for a strong comeback in the craft beer sector.
Turning a corner
Quarterhill Inc. (TSX:QTRH, Forum), a key player in the tolling and transportation technology sector, reported positive cash flow from operations in Q2 2024 for the first time in two years. This turnaround is a significant milestone for the company, which posted US$41.5 million in revenue for the quarter, a 7.5 per cent increase from the same period in 2023. For the first half of 2024, revenue reached US$76.4 million, up 14 per cent year-over-year, driven by increased activity and improved performance in North America.
Despite the positive revenue growth, Quarterhill faced challenges in profitability. Gross profit for the quarter dropped to US$8.5 million, or 21 per cent of revenue, down from US$10 million, or 26 per cent, in Q2 2023. The company attributes this to a tolling project under maintenance that is experiencing lower-than-expected margins. However, the recent acquisition of Red Fox, a provider of automatic vehicle detection and classification software, signals Quarterhill’s commitment to expanding its software offerings and could pave the way for future growth.
Under fire amid serious environmental concerns
Victoria Gold Corp. (TSX:VGCX, Forum) is in the midst of a battle with the Yukon government after a cyanide solution spill from its Eagle mine in Yukon Territory. The government has taken a hard stance, seeking to appoint a receiver over the company and its assets under Ontario’s Courts of Justice Act, citing the environmental disaster as the catalyst.
The situation escalated after dead fish were discovered in Haggart Creek near the mine site, likely killed by contaminated water discharged from the mine. The federal Department of Fisheries and Oceans has intervened, ordering Victoria Gold to implement mitigation efforts, including the installation of fish barriers along the creek. The fallout from the June 24 landslide and subsequent heap leach pad failure at the mine, which resulted in cyanide contamination, continues to cast a shadow over the company’s future prospects. Given that its share price has sunk more than 90 per cent since the incident, this company has a lot of work to do to restore good faith among the investing community.
Staying informed and vigilant
As the TSX inches back towards pre-selloff levels, the fortunes of individual stocks such as Tilray, Quarterhill, and Victoria Gold will depend on their ability to navigate challenges and capitalize on opportunities. For investors, it’s a reminder to stay informed, keep a close eye on market news, and not be discouraged by short-term fluctuations. Due diligence remains key to maintaining a robust and resilient investment portfolio in these ever-changing times.
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(Top image: The Shock Top Company)