‘Smart money’ is betting against the Canadian penny stocks on our list
SmallCapPower | August 14, 2017: Short sellers are typically sophisticated investors due to the amount of risk the practice takes. When short sellers take big positions, investors often watch with much concern. Today we have identified five Canadian penny stocks with high short interests. This adds an extra layer of risk to the inherently risky nature of penny stock investing. Investors must be completely convinced to justify an investment into these companies, because there are many smart people on the other side of the trade.
Related: Top 15 Penny Stock Picks of 2017
Mogo Finance Technology Inc. (TSX: MOGO) – $4.47
Consumer Lending
Mogo Finance Technology Inc. is a Canada-based financial technology company, which is focused on building a digital financial brand, Mogo. The Company’s technology platform provides consumers with access to responsible credit solutions. The Company leverages big data algorithms and the technologies to manage the customer experience. The Company has over 180 thousand Mogo Members and over 1.2 million loans originated. The Company offers liquid installment loan with amounts of approximately $35,000. It has launched soft credit check account sign-up allowing new Mogo members to sign up for a Mogo account.
- Market Cap: $82,192,226
- Short Interest: 10%
- Revenue (LTM): $47,210,000
Bellatrix Exploration Ltd. (TSX: BXE) – $3.15
Oil & Gas Exploration and Production
Bellatrix Exploration Ltd. is an oil and gas exploration company engaged in the exploration for, and the acquisition, development and production of oil and natural gas reserves in the provinces of Alberta, British Columbia and Saskatchewan. The Company’s properties include Ferrier, Willesden Green, Greater Pembina, Strachan and Harmattan. Ferrier is located over 30 kilometers northwest of Rocky Mountain House, Alberta. The Ferrier and Alder Flats areas produce natural gas and natural gas liquids from the Belly River, Cardium, Notikewin, Falher and Rock Creek zones at depths ranging from 1,800 to 2,700 meters.
- Market Cap: $165,459,304
- Short Interest: 8%
- Revenue (LTM): $25,385,928
Trevali Mining Corp. (TSX: TV) – $1.29
Diversified Mining
Trevali Mining Corporation is a Canada-based natural resource company engaged in the acquisition, exploration, development and production from mineral properties. The Company holds approximately four properties in Canada and has an interest in a property in Peru with an option on a second Peruvian property. The Company, through its subsidiary Trevali Peru S.A.C., operates the Santander underground metallurgical plant and mine located in Peru. It is producing zinc and lead-silver concentrates. In Canada, the Company owns through its subsidiaries, the Caribou mine and mill, the Halfmile mine and the Stratmat polymetallic deposit all located in northern New Brunswick.
- Market Cap: $523,109,546
- Short Interest: 10%
- Revenue (LTM): $9,105,500
MEG Energy Corp. (TSX: MEG) – $4.90
Oil & Gas Exploration and Production
MEG Energy Corp (MEG) is a Canada-based oil sands company focused on sustainable in situ oil sands development and production in the southern Athabasca oil sands region of Alberta, Canada. MEG is engaged in developing enhanced oil recovery projects that utilize steam-assisted gravity drainage (SAGD) extraction methods. The Company has the following commercial SAGD projects: the Christina Lake Project and the Surmont Project. The Christina Lake Project is situated on over 80 square miles of oil sands leases in the southern Athabasca oil sands region of Alberta.
- Market Cap: $1,445,711,284
- Short Interest: 9%
- Revenue (LTM): $2,196,771,000
Pulse Seismic Inc. (TSX: PSD) – $2.99
Oil Related Services and Equipment
Pulse Seismic Inc. is a Canada-based seismic data library company engaged in the acquisition, marketing and licensing of two-dimensional (2D) and three-dimensional (3D) seismic data for the energy sector in Western Canada. The Company has a seismic data library in Canada, which includes approximately 28,600 net square kilometers of 3D seismic and 447,000 net kilometers of 2D seismic. The Company’s library covers the Western Canada Sedimentary Basin (WCSB). The Company’s seismic data is used by oil and natural gas exploration and development companies to identify portions of geological formations that may to hold hydrocarbons.
- Market Cap: $165,459,304
- Short Interest: 7%
- Revenue (LTM): $15,437,000
Disclosure: Neither the author nor any of the principals at Small Cap Power, or their family members, own shares in any of the companies mentioned above.
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