From a public market perspective, 2017 was a wild ride for Canada’s innovation sectors.
The year was driven, broadly, by cannabis and blockchain stocks. But other sectors got in on the action too. 2017 had everything, including scandal (was Shopify wearing The Emperor’s New Clothes? No, investors ultimately decided ), new millionaires created via a blockchain sector that created more sizzle than anything since the dot-com era, and some long-awaited signals that the curious and extended IPO drought in the sector was about to end (anyone remember how many times Hootsuite’s IPO was imminent?).
Most of those who follow Canada’s innovation sectors know of the Cantech Letter Awards, which we present every year at a party following the Cantech Investent Conference.
Heading into their 8th year, the awards poll sell-side analysts working for Canadian banks. While some subjectivity no doubt creeps into their selections, the Cantech awards are mostly about the top performing stocks. This year, we decided to try something a little less formal and rigid. This one is about headlines. Which stories were the dominant narratives of the year in Canada’s innovation sectors? We ask you to decide. Below are five companies we think demanded more ink that the others in 2017. Which was number one?
Who was the Cantech Letter 2017 Newsmaker of the Year? Your choices are listed in alphabetical order and you can vote in a poll at the bottom of the page. One vote per person. Voting will end at midnight (PST) on December 31.
Aurora Cannabis (TSX:ACB)
In the nascent cannabis sector, Aurora has been the Pepsi to Canopy Growth Corp’s Coke. But in November, shares of the company broke out, soaring from just $2.85 on October 27 to close at $8.25 just a month later. GMP Securities analyst Martin Landry said the company’s recently shored up balance sheet set it apart.
“We believe this places ACB among the top five largest producers in the industry at the outset of recreational; not only providing Aurora with solid positioning to capture market share, but also making ACB a strong candidate to sign supply agreements with provincial governments,” Landry said in a research update to clients in early November.
Canopy Growth Corp. (TSX:WEED)
In October, a deal between Canopy and liquor giant Constellation Brands set the capital markets on its ear and, arguably, sparked a revival in the marijuana sector that has continued in the fourth quarter. “Analysts are calling this a game-changer for the sector and it’s tough to argue that that’s not the case,” said BNN’s Andrew McCreath at the time. “Constellation is one of the largest liquor, spirits and wine companies in the world. Their blessing is very good news for the entire Canadian space.”
HIVE Blockchain (TSXV:HIVE)
The stock that started the whole blockchain frenzy in Canada’s capital markets now commands a market cap near $800-million, and has now upsized its financing to a whopping $115-million. It’s now more than readily apparent that GMP Capital CEO Harris Fricker wasn’t kidding when in October he said his firm was all-in on blockchain. “We’ve got over 30 per cent of the world’s population not part of the banking system. It’s too expensive,” Fricker said recently. “The distributed ledger will change this.”
Mogo Finance Technology (TSX:MOGO)
Don’t call it comeback. Okay, you can call it a comeback, I guess. After falling sharply following its 2015 IPO, 2017 was the year Vancouver-based fintech player Mogo stormed back onto the scene. Demand for shares of Mogo is now so strong the company’s recent bought-deal financing was upsized from just over $15-million to $26.25-million. A greenshoe option could push the financing to $30.18-million. Mackie Research Capital analyst Nikhil Thadani says he thinks Mogo could go as high as $15.00.
Increasingly, when the world thinks of Canadian tech they think of Shopify, not BlackBerry or Nortel. That’s a good thing, but in October, we learned that not everyone is on board with the sentiment, exactly. Short-seller Citron issued a report claiming Shopify was a “a completely illegal get rich quick scheme” and claimed its affiliate program is primarily populated not by Small and Medium Sized businesses, but by “bloggers and influencers” who don’t disclose they are being paid by Shopify. Comparing the company to Herbalife, the report, entitled “Citron exposes the Dark Side of Shopify” put an immediate price target of $60.00 on the stock, which had closed at $119.00. Investor’s response in months following the report? Meh. After trading in the low 90 (U.S.) dollar range, the stock has bounced back over $100, with a recent high of $113.36 in late November.