Ride-sharing. Food delivery. COVID-19 contact tracing. E-commerce. Facedrive seems to do everything – except make money. The Toronto-based tech startup had rocketed more than 2,800 per cent since it began trading on the TSX Venture Exchange in 2019, reaching a market cap of more than $5-billion in February. But the company – which lost $5.9-million in the first quarter, up nearly fourfold from a year earlier – has since shed about 80 per cent of its value, with part of that decline coming after a Globe and Mail investigation in April raised questions about Facedrive’s business model and valuation. Faceplant is more like it.
Goodfood Market (STAR)
Thousands of years ago, there were no grocery stores or meal delivery services. There weren’t even any crude vending machines. But nowadays, refrigerated trucks will drop off life-sustaining protein and carbohydrates right to your door. Take Goodfood. The shares rose after the Montreal-based company reported revenue of $107.8-million for the quarter ended May 31, up 24 per cent from a year earlier, as people ordered more groceries and ready-to-cook meals during the pandemic. Hunting and gathering is so over.
WD-40 Co. (DOG)
Of all the amazing uses for WD-40 – lubricating hinges, freeing stuck parts and removing rust, for example – my favourite is neutralizing burglars by spraying it in their eyes. Judging by the company’s 39-per-cent increase in sales for the quarter ended May 31, folks have been using WD-40 for all sorts of things while they’ve been stuck at home during the pandemic. Unfortunately for investors, after D.A. Davidson analyst Linda Bolton Weiser cut her price target on the shares because of an expected slowdown in future sales, the stock seized up like a rusty bolt.
Didi Global (DOG)
You might say Didi Global is in deep doo-doo. Just days after China’s largest ride-hailing company raised US$4.4-billion in a U.S. initial public offering, China’s cybersecurity regulator ordered mobile stores to stop new downloads of the app, alleging “serious violations” of data security laws. Didi was subsequently hit with multiple U.S. lawsuits claiming the company knew it was not in compliance but failed to disclose this before the IPO. With Beijing cracking down on other tech firms that recently listed in the U.S. – erasing billions in shareholder value in the process – investors are hailing a ride as far away from Chinese stocks as possible.
Newegg Commerce (STAR)
Business quiz! Newegg Commerce is: a) the largest U.S. distributor of chicken, duck, ostrich and platypus eggs (be generous with the ketchup); b) a biotech company that recently patented a process to convert sawdust and other sawmill waste into scrambled eggs; c) an online consumer electronics retailer and “meme” stock whose shares jumped on news that it was selling hard-to-find Nvidia GeForce RTX graphics cards, which are in demand with gamers and cryptocurrency miners. Answer: c.
A humorous look at the companies that caught our eye, for better or worse, this week
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