Tech Revival: Meet the High-Volume Tech Stocks of the TSX Venture Exchange

When the company rocketed from pennies in January to more than $1.50 in April, it left TSX Venture investors scrambling to understand its business and how Intertainment was becoming the most heavily traded stock on the exchange.

With the possible exception of Calgary’s location-based search company Poynt, however, Intertainment was the lone tech issue whose name was at all familiar to those who normally invested in gold, gas or lumber.

But are things changing? With the TSX mining sector continuing to struggle, many investors are once again looking towards tech stocks. Maybe, with Groupon and Linkedin having gone public and social media behemoth Facebook on deck, it’s a bit of the tech frenzy in the lower-48 rubbing off. Or maybe it’s because, relative to their US counterparts, Canadian tech stocks are much more profitable.

Whatever the reason, a shift is happening and a whole host of new tech issues are now on the radar of investors, especially those with speculative inclinations. On February 10th, for instance, four of the top ten volume traders on the TSX Venture Exchange were technology related, including the top three traders. This is especially notable when you consider there are 1646 companies in the TSX and TSX Venture Mining Sector, but only 179 listed in Technology.

So who are these previously little-known issues that are now trading millions of shares? We break them down and give you a chance to vote on which you think will perform best in 2012. Companies are listed in order by market capitalization; highest to lowest.

1. Intertainment Media (TSXV:INT)

Nearly two months into 2012 and Intertainment Media seems unwilling to give up its title of king of the junior techs. The stock’s resurgence (shares of Intertainment more than doubled between December 21st and February 6th, from $.40 cents to $.83 cents) is fueled by the continuing success of its translation software Ortsbo, and the company’s plans to spin the division off as its own entity.

2. Poynt (TSXV:PYN)

Shareholders of Calgary’s Poynt would no doubt love to see a resurgence in the fortunes of its eponymous stock, which slipped to as low as a dime after trading as high as $.85 cents before the 2008 meltdown. Poynt the app continues to grow; the company recently entered the Chinese market, where it expects to deliver at least twenty-million active users by this time next year. CEO Andrew Osis thinks several recent deals signal the beginning of a new era in the company’s history, one that will more closely align the fortunes of the stock with the fortunes of the app. Cantech Letter caught up with him recently to discuss them.

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This story is brought to you by Serenic (TSXV:SER). Serenic’s market cap of $3.18 million (as of January 27th, 2012) was less than its cash position of $4.03 million (as of Q2, 2012). The company has no debt. Click here for more information.

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3. Innovative Composites (TSXV:IC)

Burlington’s Innovative Composites was formed in 2007 and almost immediately attracted some high level talent in the form of current CEO Terry Ball, who spent eighteen years at Magma, and Jerry Olszewski, from came over from Chrysler. More recently, the company added industry veteran Rubens Roque as COO and Allan Landosky, who worked with General Electric, General Motors and Caterpillar. Innovative Composites has steadily built an intellectual property portfolio based around improving the materials used in everyday products. The company’s Structure Lite product provides a molecular bond between structural fibres and can be used in anything from horse trailers to marine docks to pedestrian bridges. Its Hero 451 product line includes BlanketHero, an antimicrobial fire blanket that will not ignite. The company is currently working towards the opening of a 126,000-square-foot manufacturing facility in Orangeburg, South Carolina.

4. Zecotek Photonics (TSXV:ZMS)

Vancouver’s Zecotek Photonics, which dates its history back to 2004, is the brainchild of Dr. Faouzi Zerrouk, an English educated PhD in Theoretical Physics, who became a leading expert in photonics technologies. Today, after investing more than $25 million in its technology, Zecotek owns title to or controls more than fifty-five patents and applications and is on the verge of commercializing its laser systems, high-performance crystals, solid-state photo detectors and other imaging and 3D display technologies. Shares of Zecotek have nearly doubled since they closed at $.345 cents on January 11th. Recently, Cantech Letter’s Nick Waddell spoke with Zerrouk.

5. Verisante (TSXV:VRS)

For Vancouver’s Verisante the waiting game appears to be over. The company’s skin cancer detection device, Aura, seems on the cusp of moving from concept to practice, as Verisante has received approval to sell it in Australia, Europe and here in Canada. Rainy Vancouver might seem an odd point of origin for science that may be set to turn the multi-billion dollar skin cancer market on its sunburned ear. But this fact seems much less curious when one notes the company’s deep ties to the UBC Department of Dermatology and Skin Science, which is a world leader.

Cantech Letter recently sat down with Verisante CEO Thomas Braun to talk about the company’s transition to commercialization.

6. CardioComm (TSXV:EKG)

Shares of CardioComm caught fire after the company announced it had cleared an important hurdle in its goal to market a new handheld ECG device called the HeartCheck Pen. After closing at $.145 cents on Januray 23rd, Cardiocomm closed at $.435 the next day, after more than 29 million shares changed hands.

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7. Synchronica (TSXV:SYN)

Earlier this year, Synchronica, a company headquartered in the UK but listed on the TSX Venture Exchange received a buyout offer from Swiss-based Myriad AG. Soon after, Synchronica announced its board could not come to an agreement with Myriad AG and advised shareholders to take no action. And then, a surprise, as Synchronica announced it has signed a Letter of Intent with Toronto’s Intertainment Media to integrate Synchronica’s flagship messaging platform, Mobile Gateway, with Intertainment Media’s Ortsbo experiential language technology. As part of the transaction, Intertainment Media will also, subject to Synchronica shareholder approval, invest up to CDN $ 10 million in Synchronica. On heavy volume, shares of the company have nearly doubled since mid-December. As the news broke on the deal, Cantech Letter’s Nick Waddell talked to Synchronica CEO Angus Dent and Intertainment Media CEO David Lucatch about the deal.

8. Edgewater Wireless (TSXV:YFI)

KIK Polymers spent the bulk of 2011 working on the acquisition of of Edgewater Wireless, an Ottawa company with twenty patents in the wireless space. KIK, a company that had been around since 1980, got a new lease on life with the acquisition, which was completed on October 13th. The company changed its name and ticker symbol earlier this month, and the stock has nearly doubled on heavy volume this year.

9. Medipattern (TSXV:MKI)

2008 was supposed to be Medipattern’s big year. The Toronto based company, which designs medical imaging software, went public in 2005, then soared to $1.64 in the first days of 2008 on the promise of a new medical imaging system for breast cancer detection. When the tangle of regulatory hurdles combined with the worst recession in a generation, it tripped up the company’s plan to commercialize its technology. Shares of Medipattern plunged to nearly a nickel before staging a modest recovery in 2011. This year, however, Medipattern investors should begin to see real revenue for the first time. That’s because, last February, the company received FDA clearance for Visualize: Vascular. The product can help a physician assess vascular disease using ultrasound imaging by performing 3D rendering of the carotid artery.

10. Medx Health (TSXV:MDX)

On February 9th, Shares of Medx raced from under a nickel to $.255 cents on more than sixteen million shares of volume. The reason? The company received Health Canada approval for Molemate, a non-invasive imaging system that allows practitioners to see approximately two millimetres below the surface of suspicious moles. In the last quarter of 2011 the Mississauga-based company began selling into the US market, which it believes is a billion dollar opportunity.

Disclaimer: Intertainment Media, Zecotek and Verisante are annual sponsors of Cantech Letter.

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