Canadian high growth contenders look very different when central banks start to talk tough on inflation again. With a US Federal Reserve official calling for another rate hike soon, money tends to move toward businesses that already have compelling growth plans and clear support from analysts and management. This article breaks down three of the most interesting Canadian high conviction growth stocks from that group for your watchlist.
The three stocks highlighted below are just a starting sample. The full High Growth High Conviction screen surfaced seven more Canadian companies with equally compelling narratives that are not covered in this article.
To see the whole field and focus on the ideas that match your style, head straight into the High Growth High Conviction screener to identify, compare, and analyze the highest conviction opportunities.
CEMATRIX (TSX:CEMX)
Overview:CEMATRIX produces and installs cellular concrete on project sites, supplying lightweight backfill and flowable fill for infrastructure and remediation work.
Operations:The business generates about CA$53.8 million from supplying and placing cellular concrete, with CA$11.8 million in Canada and CA$42 million in the United States.
Market Cap:CA$76.4 million
CEMATRIX fits this High Growth High Conviction screen because its onsite cellular concrete service is directly tied to infrastructure buildouts where management and analysts see strong project pipelines forming around sustainability and remediation themes.
"Rising demand for sustainable, low-carbon construction materials, driven by both regulatory pressure and ESG-conscious customers, favors CEMATRIX's environmentally friendly product, increasing its addressable market and supporting revenue expansion and margin improvement.
What really matters now is how one less visible pressure on profitability plays out as that demand story scales up.
If that pressure point is what you care about, read the full narrative for CEMATRIX to see how CEMATRIX's margins could decouple from headline project growth.
Cambria Gold Mines (TSXV:CAMB)
Overview:Cambria Gold Mines is a Vancouver based miner focused on exploring and advancing its 100% owned Premier Gold project in British Columbia.
Market Cap:CA$306.9 million
Cambria Gold Mines draws attention in a High Growth High Conviction context because the entire growth story is anchored to the Premier Gold project, with earnings forecast to rise 85.25% a year and profitability expected within about three years. The appeal, and the risk, comes down to how this single asset progresses from drilling results and feasibility studies into a fully funded mine plan if one crucial assumption holds.
If that single asset focus is what catches your eye, review the analysis report for Cambria Gold Mines to see how the Premier project case could evolve from here.
Allied Gold (TSX:AAUC)
Overview:Allied Gold is a Toronto based miner running African gold and silver operations, with growth anchored by its flagship Sadiola project in Mali.
Operations:Allied Gold generates revenue from three mines, with about $733 million from Sadiola, $418 million from Bonikro, and $343 million from Agbaou.
Market Cap:CA$3.94 billion
Allied Gold fits the High Growth High Conviction theme because Sadiola is already a producing asset that anchors management's expansion plans and analyst optimism around future output and earnings potential.
"The 20 year US$0.04 per kWh power agreement for Kurmuk and the shift to a solar plus modern diesel power solution at Sadiola create a low cost power platform."
What investors need to watch now is how one emerging production and cost turning point ultimately feeds through into margins and cash generation.
That turning point is exactly what the full narrative for Allied Gold unpacks, showing how Allied Gold's power platform could accelerate cash generation while reshaping the risk profile.
Curious About High Conviction Alternatives?
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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