A weekly look at some small-cap stocks making news - or about to.
Canada’s S&P/TSX Small Cap Index TXTW-I is up about 22 per cent over the past 52 weeks. The index reached a record high of 955.18 on July 23. The Russell 2000 in the U.S. is up about 1 per cent over the past 52 weeks, as of midday trading on Friday.
Small-cap spotlight
It may be mid-summer, but Spin Master Corp. (TOY-T) investors will be looking for details on how the holiday shopping season is shaping up when the toy, games and entertainment company reports its second-quarter financial results next week.
Analysts are cautioning that Toronto-based Spin Master, the company behind brands such as Paw Patrol and Melissa & Doug, could be affected by order delays that are also impacting other toy companies, including Hasbro Inc. in the U.S.
Stifel analyst Martin Landry lowered his target price to $33 from $38 this week ahead of the earnings, citing “ongoing headwinds” and after lowering sales forecasts for 2026, “to reflect more conservative assumptions and these flow through the bottom line.”
The analyst, who kept his “buy” on the stock, cited toy maker Hasbro Inc.’s North American consumer product revenues, which were down 23 per cent year-over-year in its second quarter, ”the worst performance in several years,” he wrote in a July 23 note, adding the decline comes from delayed orders from U.S.-based retailers for the holiday period, which are usually shipped in the second quarter.
“This year, it appears that retailers took very little to no inventory related to the holidays during Q2 [the second quarter] due to the tariff situation,“ he wrote, adding that Spin Master is scheduled to report its second-quarter results on July 31, ”and we believe the company will be impacted similarly to Hasbro.“
Mr. Landry reduced his second-quarter revenue estimates for Spin Master by 14 per cent to $378.3-million.
“We now expect Spin Master’s Q2/25 revenues to be down 10 per cent Y/Y [year over year] for toys and down 8 per cent Y/Y in total.” He also lowered his EBITDA estimate by 43 per cent to $35-million from $62-million previously. Last year’s number was $53.6-million.
“There is a strong possibility that Spin Master sales will be down Y/Y in Q2/25 due to the delays in ordering from major U.S.-based retailers,” he wrote. “We believe this will also have an impact on profitability and fixed cost absorption. In addition, Spin Master is likely to have incurred increased logistics costs to deal with the shift to domestic sourcing from some of its clients.”
Mr. Landry wrote that he believes consensus estimates “appear too high, currently expecting sales to increase Y/Y combined with limited margin erosion.”
The analyst consensus is for Spin Master’s second-quarter revenues to come in at $418.5-million, according to S&P Capital IQ estimates on Thursday. Revenue for the second quarter of 2024 was $412-million.
National Bank Financial analyst Adam Shine, who has an “outperform” rating and $29 target, reduced his second-quarter revenue estimates last month to $433-million from $456-million and his adjusted EBITDA to $45-million from $62-million.
“It’s possible we pruned too much,” he wrote in the June 24 note, adding that some adjustments are necessary given various factors including leadership changes and “tariff chaos of April which reduced the number of containerships from Asia (especially China), and strategic planning that took place in May to try to cope with the changing dynamic in 2025.”
Spin Master also announced on June 23 that its CEO Max Rangel would step down on July 7 and be replaced by Christina Miller, a board member since 2020. It also put in a new chief financial officer in May.
In the past 52 weeks, the stock has traded between a high of $35.44 and a low of $20.97.
Small-cap summary
Other small caps making news this week:
GO Residential Real Estate Investment Trust (GO-U-T), a luxury rental apartment owner in New York City, pulled off its US$410-million initial public offering on the Toronto Stock Exchange, pricing its units at US$15 apiece. It begins trading on the TSX today.
After converting to Canadian dollars, GO Residential is raising $560-million, making it one of the largest-ever real-estate IPOs in Canada.
Read the full Globe story here
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Winpak Ltd. (WPK-T) shares closed down 4 per cent on Thursday after the company reported lower sales and profit for its second quarter, which also missed expectations.
During market hours on Thursday, the food and health care packaging company reported revenues of US$272.8-million, down from US$283.5-million a year ago. The expectation was for revenues of US$290-million.
“Muted customer demand within certain product categories contributed to the result,” the company stated.
Net income of US$30.2-million or 49 cents US per share was down from US$38.8-million or 61 cents US per share last year. The expectation was for earnings of 62 cents US per share in the latest quarter.
National Bank Financial analyst Ahmed Abdullah downgraded the stock to “sector perform” (hold) from “outperform” (buy) and lowered his target to $48 from $52 after the earnings release.
“We await a gradual recovery of volumes that may take a few quarters to unfold as the company works on onboarding new business wins and revisiting its go-to-market strategy to deal with a softer backdrop,” he wrote, adding that the shares “will likely be range-bound in the near term.”
In the past 52 weeks, the stock has traded between a high of $51.16 and a low of $37.57.
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Orla Mining Ltd. (OLA-T) shares sank this week after the company reported an “uncontrolled material movement event” on the pit wall at its Camino Rojo Oxide Mine in Zacatecas, Mexico, which temporarily suspended mining.
The company said there were no injuries or equipment damage as a result of the incident, which was detected early by the pit-monitoring systems. It stated the event was caused by significant rain.
In the past 52 weeks, the stock has traded between a high of $17.45 and a low of $4.60.
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A&W Food Services of Canada Inc. (AW-T) reported higher sales and profits for its second quarter.
Before markets opened on Thursday, the fast-food chain stated that its revenues increased 7 per cent to $68.8-million in the quarter ended June 15 compared to $64.3-million a year earlier. The result was slightly ahead of expectations of $68.2-million, according to S&P Capital IQ. Same-store sales (SSS) increased 1.6 per cent year over year.
Net income of $12.5-million was up from $8.8-million a year ago. Adjusted EBITDA of $25.5-million was up from $21.5-million a year ago and ahead of expectations of $23.4-million.
CIBC Capital Markets analyst Mark Petrie increased his target to $41 from $36 but maintained his “neutral” (hold) rating after the earnings came out.
“A&W’s solid Q2 results demonstrate healthy execution in a challenging operating environment,” he wrote.
He noted that the SSS growth of 1.6 per cent was the best result since the fourth quarter of 2023 and an improvement from 0.4 per cent growth in the first quarter of this year.
“While some of this was driven by inflation increasing average cheque size, we see the increase in guest counts driven by successful marketing campaigns as a positive sign. Consumers continue to gravitate towards value and clearly the $4.99 Teen Burger promotion was a material contributor to Q2 SSS,” he wrote. “We expect A&W’s positioning towards the premium end of the QSR [quick-service restaurant] industry will remain an impediment to better SSS growth in the near term, but clearly management has tools at its disposal to deliver healthy SSS.”
He also view’s the company’s current valuation as “balanced,” trading at EV/EBITDA multiples of 12.3 times on 2025 estimates and 11.6 times on 2026 estimated.
“Shares are still yielding an attractive 4.8 per cent, though with a payout ratio of 87 per cent based on 2025E EPS, we see limited near-term upside to the dividend,” he added.
In the past 52 weeks, the stock has traded between a high of $41.71 and a low of $28.38.
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Mullen Group Ltd. (MTL-T) shares fell in Thursday trading after the company reported second-quarter earnings that missed expectations, although its revenue beat.
Before markets opened on Thursday, the Okotoks, Alta.-based company reported record quarterly revenues of $540.9-million for the quarter ended June 30, up from $495.6-million a year earlier. The expectation was for revenue of $523.5-million.
“Second quarter consolidated revenues were positively impacted by acquisitions which, as we have suggested for some time now, is the only plausible means of growing during uncertain times and given the current supply/demand imbalance situation in nearly all segments of the logistics industry,“ stated company chair Murray Mullen in a release.
Net income of $25.6-million or 28 cents per share compared to $32.9-million or 36 cents a year ago. Adjusted net income was $18.5-million or 21 cents per share compared to $32.8-million or 37 cents last year. The expectation was for earnings of 31 cents per share in the second quarter.
Acumen Capital analyst Trevor Reynolds, who has a “buy” rating and $18.25 target on the stock, said the results came in slightly below his estimates but generally in line with consensus.
“While management’s outlook is largely intact from Q1 [the first quarter], they do highlight the fast tracking of ‘nation building’ projects as a potential market catalyst,“ he said in a note.
“Overall, MTL was able to increase revenue year over year on the back of acquisitions while adjusted EBITDA and margins were down slightly as a result of higher SG&A [selling, general and administrative expenses] due to acquisitions and increased direct operating expenses attributable to cost escalation, competitive pricing, and a reduction in higher margin specialized business.”
In the past 52 weeks, the stock has traded between a high of $16.06 and a low of $11.81.
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Western Forest Products Inc. (WEF-T) stated that its previously announced one-for-30 share consolidation is expected to start on July 28.
The company stated that the common shares will continue to be listed on the TSX under the symbol “WEF” on a post-consolidation basis and that no fractional common shares will be issued as a result of the consolidation.
As a result of the consolidation, the number of issued and outstanding common shares will be reduced to about 10.6 million, down from 316.7 million.
In the past 52 weeks, the stock has traded between a high of 58 cents and a low of 36 cents.
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Quarterhill Inc. (QTRH-T) announced before markets opened on Thursday that it’s cutting about 15 per cent of its workforce, or about 100 jobs, with a goal to save around US$12-million annually.
“This strategic initiative is intended to reduce costs, accelerate the path toward sustainable positive adjusted EBITDA and operating cash flow, and better align resources with our long-term strategic priorities and those of our customers,” the company stated in a release.
In the past 52 weeks, the stock has traded between a high of $1.92 and a low of $1.28.
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StorageVault Canada Inc. (SVI-T) shares jumped in Thursday trading after the company reported higher revenues that beat expectations and trimmed its losses in the latest quarter compared to a year ago.
After markets closed on Wednesday, the company that owns and operates 259 storage locations across Canada, reported revenues of $83.5-million, up from $74.1-million a year earlier. The expectation was for revenue of $78.8-million.
Its net loss of $6.2-million compared to a loss of $8.7-million a year ago.
The company increased its third-quarter dividend by 0.5 per cent to $0.002976 per share.
Canaccord Genuity analyst Mark Rothschild increased his target price to $5 from $4.50 following the earnings release and maintained his “buy” rating.
“Though results were in line with expectations, the improvement in occupancy was notable, and we are raising our estimates slightly,” he wrote, adding that his forecast reflects “solid organic growth” and expectations that it will continue to improve.
“Further, continuing to lease-up recently acquired properties, combined with replacing variable-rate debt with lower-cost fixed-rate mortgages, should contribute to greater cash flow growth,” he wrote.
In the past 52 weeks, the stock has traded between a high of $5.20 and a low of $3.53.
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Algoma Steel Group Inc. (ASTL-T) chief executive Michael Garcia says the Canadian steel maker is in discussions with Ottawa to try to secure a financing package worth more than half a billion dollars as financial pressures mount during a trade war with the United States.
U.S. President Donald Trump in March imposed 25-per-cent tariffs on global imports of steel into the U.S. He doubled the tariff to 50 per cent last month, which essentially closed the American market entirely to Canadian steel makers.
Prime Minister Mark Carney has said that a tariff-free trade deal between Canada and the U.S. isn’t realistic, and signalled that the timing of any pact is up in the air.
Algoma Steel, based in Sault Ste. Marie, Ont., has outsized exposure to the tariffs, owing to its single Ontario plant relying heavily on the U.S. market. Before the trade war began, Algoma sold roughly 60 per cent of its output to the U.S.
Mr. Garcia in an interview on Wednesday said the company is in talks with the federal government and hopes to secure between $400-million and $600-million in loans to help keep it afloat over the medium term. The package could also eventually see the government purchase an equity stake in Algoma.
Read the Globe’s full story here
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Adf Group Inc. (DRX-T) shares surged 30 per cent earlier this week after the company announced that it signed a “major” five-year contract valued between $35-million and $40-million per year for the supply, fabrication and delivery of steel structures.
Before markets opened on Wednesday, Adf Group stated that the contract is part of a new infrastructure project in the energy sector in Quebec and includes an option to extend it for an additional five years.
“At maturity, and including the inflation clauses, this major contract could total close to $400-million,” the company stated.
In the past 52 weeks, the stock has traded between a high of $14.55 and a low of $5.
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Pulse Seismic Inc. (PSD-T) shares rose this week after the company reported a big jump in second-quarter earnings.
After markets closed on Tuesday, the company that provides seismic data to the western Canadian energy sector reported revenues of $18.3-million for the quarter ended June 30, compared to $6.3-million for the same period last year.
Net earnings were $9.6-million or 19 cents per share compared to net earnings of $1.3-million or 3 cents last year.
The company also declared a special dividend of 20 cents per share, in addition to its regular quarterly dividend of 17.5 cents.
In the past 52 weeks, the stock has traded between a high of $3.76 and a low of $2.10.
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Goodfood Market Corp. (FOOD-T) slid this week after the meal-kit company reported a drop in first-quarter sales.
After markets closed on Monday, Goodfood reported sales of $30.7-million for the quarter ended June 7, down from $38.6-million for the same quarter last year.
“The decrease in net sales is driven by the decrease in active customer driving lower orders partially offset by an increase in average order value,” the company stated, adding that the drop in active customers was due to the uncertain economic outlook related to tariffs “driving customers towards spending more carefully as well as lower incentive offers compared to the same period last year.”
Net income of $54,000 or nil per share compared to net income of $307,000 or nil per share a year ago. Adjusted EBITDA of $2.7-million compared to $3.6-million a year earlier.
In the past 52 weeks, the stock has traded between a high of 54 cents and a low of 14 cents.
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Champion Iron Ltd. (CIA-T) stock rose sharply earlier this week after the Australian-based company announced on Monday a $245-million investment from Japan’s Nippon Steel Corp. and Sojitz Corp. for a 49-per-cent interest in its Kami iron ore project in Canada.
The investment follows an agreement the three companies entered into in December, 2024.
In the past 52 weeks, the stock has traded between a high of $6.90 and a low of $3.29 on the TSX.
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AutoCanada Inc. (ACQ-T) shares rose earlier this week after the car dealership company announced that it chose CarGurus (CARG-Q) as its preferred partner in Canada.
“Through this long-term relationship, AutoCanada will have access to the power and reach of CarGurus’ leading listings marketplace, advanced digital marketing and retail solutions, and market intelligence powered by proprietary data and predictive insights,” the company stated in a release after markets closed on Monday.
Acumen Capital analyst Trevor Reynolds said in a July 22 note that the relationship with CarGurus is “expected to aid the company in navigating shifting market dynamics and consumer behaviour.
Mr. Reynolds has a “speculative buy” on the stock and increased his target price to $30.50 from $23.75 ahead of the company’s second-quarter earnings expected to be released on Aug. 13. He wrote that the increase comes “on the back of several recent announcements and continued execution on cost reductions.”
Mr. Reynolds says he’s looking for revenue to come in at about $1.42-billion and adjusted EBITDA of $50.5-million, compared to consensus of about $1.35-billion and $46.8-million, respectively.
“Following several announcements over the past few weeks that include a planned executive transition, the sale of 13 underperforming U.S. dealerships for $82.7-million, which is expected to have moved the company back into compliance with bank covenants, a new partnership with CarGurus, and continued delivery on cost reductions announced with Q1/25 results we are increasing our target ahead of the quarter,” he wrote.
In the past 52 weeks, AutoCanada stock has traded between a high of $30.65 and a low of $13.75.
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Colabor Group Inc. (GCL-T) announced on Monday that it had identified a cybersecurity incident on July 20 that impacted its internal IT systems.
“Upon detecting the incident, Colabor took immediate steps to protect its network and data,” it stated, including hiring cybersecurity experts to help with containment and remediation efforts and to understand the “scope and impact of the incident.”
The company reports earnings after market close today (July 24).
In the past 52 weeks, the stock has traded between a high of $1.52 and a low of 79 cents.
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HydroGraph Clean Power Inc. (HG-CN) shares surged to a record high early this week, prompting the company to issue a statement before markets opened on Tuesday - at the request of the Canadian Investment Regulatory Organization (CIRO) - stating that “there is no undisclosed material information at this time.”
Vancouver-based HydroGraph makes “pristine graphene” used in plastics, coatings, energy storage and other industrial sectors.
On Monday, the company announced the launch of its so-called “Compounding Partner Program,” which it stated would speed up the adoption of its “fractal graphene” product in thermoplastics.
“The initiative establishes a qualified network of plastic compounders with demonstrated expertise in processing graphene-enhanced thermoplastic materials, with early partners already piloting new formulations across automotive and packaging sectors,” it stated, adding that “there are no material changes to the Company’s operations or financial condition associated with this announcement.”
In the past 52 weeks, the stock has traded between a high of 64 cents (also a record) and a low of 10 cents. The stock has nearly doubled this week.
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Chorus Aviation Inc. (CHR-T) announced after markets closed on Monday that it acquired Elisen & Associates Inc., an aerospace engineering and certification services company based in Montreal.
“Acquiring Elisen will position us to grow our defence and specialized MRO capabilities by adding valuable expertise and industry relationships,” said CEO Colin Copp.
The terms weren’t disclosed, but the company stated that the transaction will be funded from cash and isn’t expected to have a material impact on its consolidated revenue, earnings or balance sheet.
In the past 52 weeks, the stock has traded between a high of $24.08 and a low of $16.87.
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Upcoming small-cap earnings:
July 28: New Gold Inc. (NGD-T), Tilray Brands Inc. (TLRY-T), Cannara Biotech Inc. (LOVE-X)
July 29: First National Financial Corp. FN-T, Morguard North American Residential REIT (MRG-UN-T), Trican Well Service Ltd. (TCW-T), Algoma Steel Group Inc. (ASTL-T)
July 30: First Capital REIT (FCR-UN-T), Morguard REIT (MRT-UN-T), Champion Iron Ltd. (CIA-T), Information Services Corp. (ISC-T), Badger Infrastructure Solutions Ltd. (BDGI-T), DIRTT Environmental Solutions Ltd. (DRT-T)
July 31: Aecon Group Inc. (ARE-T), Real Matters Inc. (REAL-T), Spin Master Corp. (TOY-T), Dundee Precious Metals Inc. (DPM-T), Coveo Solutions Inc. (CVO-T), Lightspeed Commerce Inc. (LSPD-T), Canada Goose Holdings Inc. (GOOS-T), Ag Growth International Inc. (AFN-T), Foraco International SA (FAR-T), Kiwetinohk Energy Corp. (KEC-T)
Aug. 1: NFI Group Inc. (NFI-T), Canfor Corp. (CFP-T), Canfor Pulp Products Inc. (CFX-T)
Aug. 4: BTB Real Estate Investment Trust (BTB-UN-T)
Aug. 5: CT REIT (CRT-UN-T), Pet Valu Holdings Ltd. (PET-T), Stingray Group Inc. (RAY-A-B), Dream Industrial REIT (DIR-UN-T)
Aug 6: Killam Apartment REIT (KMP-UN-T), Cargojet Inc. (CJT-T), BSR REIT (HOM-U-T), Curaleaf Holdings Inc.(CURA-T), Pason Systems Inc. (PSI-T), Total Energy Services Inc. (TOT-T), Extendicare Inc. (EXE-T), Centerra Gold Inc. (CG-T), Trulieve Cannabis Corp. (TRUL-CN), Step Energy Services Ltd. (STEP-T), Thinkific Labs Inc. (THNC-T), Propel Holdings Inc. (PRL-T), Kits Eyecare Ltd. (KITS-T), Doman Building Materials Group Ltd. (DBM-T), Andrew Peller Ltd. (ADW-A-T), Premium Brands Holdings Corp. (PBH-T), American Hotel Income Properties REIT LP (HOT-UN-T), Goeasy Ltd. (GSY-T), Aurora Cannabis Inc. (ACB-T), Fortuna Mines Inc. (FVI-T), InterRent Real Estate Investment Trust (IIP-UN-T), Canaccord Genuity Group Inc. (CF-T)
Aug. 7: Western Forest Products Inc. (WEF-T), Alaris Equity Partners Income Trust (AD-UN-T), Russel Metals Inc. (RUS-T), Artis REIT (AX-UN-T), Black Diamond Group Ltd. (BDI-T), Altus Group Ltd. (AIF-T), Interfor Corp. (IFP-T), Hut 8 Corp. (HUT-T), Flagship Communities Real Estate Investment Trust (MHC-UN-T), TerrAscend Corp. (TSND-T), Slate Grocery REIT (SGR-UN-T), Silvercorp Inc. (SVM-T), MDA Space (MDA-T), Maple Leaf Foods Inc. (MFI-I), Dream Office REIT (D-UN-T), Pizza Pizza Royalty Corp. (PZA-T), Alaris Equity Partners Income Trust (AD-UN-T), Energy Fuels Inc. (EFR-T), Tucows Inc. (TC-T), Supremex Inc. (SXP-T), ATS Corp. (ATS-S), Aris Mining Corp. (ARIS-T), Medical Facilities Corp. (DR-T), High Liner Foods Inc. (HLF-T), Cronos Group Inc. (CRON-T)
Aug. 8: Boralex Inc. (BLX-T), Ensign Energy Services Inc. (ESI-T), Fiera Capital Corp. (FSZ-T)
Aug. 11: K92 Mining Inc. (KNT-T), Ballard Power Systems (BLDP-T),
Aug. 12: Westport Fuel Systems Inc. (WPRT-T), Sienna Senior Living Inc. (SIA-T), Superior Plus Corp. (SPB-T), Cineplex Inc. (CGX-T), Dream Unlimited Corp. (DRM-T), Grown Rogue International Inc. (GRIN-CN), Rogers Sugar Inc. (RSI-T)
Aug. 13: H&R REIT (HR-UN-T), Bird Construction Inc. (BDT-T), Galiano Gold Inc. (GAU-T), Minto Apartment REIT (MI-UN-T), Pollard Banknote Ltd. (PBL-T), KP Tissue Inc. (KPT-T), AutoCanada Inc. (ACQ-T), Frontera Energy Corp. (FEC-T),
Aug. 14: Automotive Properties Real Estate Investment Trust (APR-UN-T), Chemtrade Logistics Income Fund (CHE-UN-T), North American Construction Group Ltd. (NOA-T), DRI Healthcare Trust (DHT-UN-T), Bragg Gaming Group Inc. (BRAG-T), Profound Medical Corp. (PRN-T)
Aug. 20: Corby Spirit and Wine Limited (CSW-A-T)
Sept. 24: AGF Management Ltd. (AGF-B-T)