3 Canadian Juniors That Could Thrive Even with a Sub-70-Cent Loonie

Published:

SmallCapPower | January 12, 2016  Canada, being a resource-focused economy, has suffered in 2015 in the wake of falling metals and energy prices. In turn, this has weakened demand for the Canadian Dollar. Canadian businesses that generate revenues in the U.S. and record costs in Canadian dollars, however, are precisely the companies to watch at the moment, which includes the ones on our list today.

The Ubika Gold 20 Index (UG20) surged 13.1% this month outperforming both the TSX Gold Index and the gold price, which gained 7.4% and 2.8%, respectively. Over the past 52-weeks, the UG20 is closest to seeing green, dropping a mere 1.7% versus gold’s drop of 8.7% and TSX Gold Index’s decline of 10.8%. SEMAFO Inc. (TSX: SMF) was the top-performing component company this month, climbing 22%.
download-button

Figure 1: Major Global Currencies, Performance vs. USD (Jan 2015 – Present)
 Source: Thomson Reuters (01/11/2016)

This 18% drop was exacerbated by a flourishing U.S. economy, and another rate cut by the Bank of Canada in July 2015, which only diminishes foreign investment into Canadian-denominated securities.
However, not all businesses stand to lose from a weaker dollar. Predominately, Canadian businesses that generate revenues in the U.S., and record costs in Canadian dollars, are precisely the companies to watch at the moment. These businesses, such as the ones on our list today, are well positioned to endure the low-dollar environment.

SciVacTIO Networks Corp.(TSXV: TNC)
IT Software & Services
TIO Networks Corp. is a Canada-based company that specializes in processing bill payment transactions through a secure Internet-enabled platform. The Company is a Cloud-based, multi-channel bill payment processor. TIO derives most of its revenues from the U.S., and has built up US$46.7 million in revenues during the past 12 months (LTM).


tio networks CEOBe sure to check out our interview with TIO Netsworks Corp. CEO interview with Hamed Shahbazi.


AviSciVacgilon Corp.(TSX: AVO)
Security Technology
Avigilon Corporation is a security solutions Company, which develops, manufactures, markets and sells high definition (HD) and megapixel (MP) network-based video surveillance systems, video analytics and access control equipment for the global security market. Th
e Company derived 54% of revenues from the United States in 2014. LTM revenues topped US$276.6 million.

SciVacMitel Networks Corp.(TSX: MNW)
Communications Equipment
Mitel Networks Corporation is a global provider of business communications and collaboration software, services and solutions. The Company operates in three geographic markets: Americas, Europe and Asia Pacific. Mitel derived 38% of revenues from the United States in 2014. LTM revenues were US$1.1 billion.

DISCLAIMER
 The Content contained on this page (including any facts, views, opinions, recommendations, description of, or references to, products or securities) made available by SmallCapPower/Ubika Research is for information purposes only and is not tailored to the needs or circumstances of any particular person. Any mention of a particular security is merely a general discussion of the merits and risks associated there with and is not to be used or construed as an offer to sell, a solicitation of an offer to buy, or an endorsement, recommendation, or sponsorship of any entity or security by SmallCapPower/Ubika Research. The Reader should apply his/her own judgment in making any use of any Content, including, without limitation, the use of any information contained therein as the basis for any conclusions. The Reader bears responsibility for his/her own investment research and decisions. Before making any investment decision, it is strongly recommended that you seek outside advice from a qualified investment advisor. SmallCapPower/Ubika Research does not provide or guarantee any financial, legal, tax, or accounting advice or advice regarding the suitability, profitability, or potential value of any particular investment, security, or information source.

Related articles

Recent articles