7 Vertical Farming Stocks to Buy Before They Boom

Vertical farming stocks - 7 Vertical Farming Stocks to Buy Before They Boom

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  • AppHarvest (APPH): AppHarvest designs and manufactures some of the country’s largest indoor farms.
  • Hydrofarm Holdings (HYFM): The company is one of the most reputable names in controlled environment agriculture (CEA), manufacturing high-intensity grow lights and other unique environments.
  • Village Farms International (VFF): Although VFF is known for its large hydroponic greenhouses, it is also a big name in the marijuana business.
  • Agrify Corp (AGFY): Agrify plans to help the cannabis and hemp industry with its LED farm lights and air purifiers.
  • GrowGeneration Corp (GRWG): With triple-digit growth during the last fiscal year, GrowGeneration has expanded quickly and plans to open many more stores.
  • Urban-Gro (UGRO): Urban-gro uses hydroponic technology and LED lighting to grow plants in the dark space of an indoor environment.
  • Spring Valley Acquisition Corp (SV): AeroFarms, a leading indoor farming company, will debut on the markets through a reverse merger. It is one of the suppliers for Whole Foods.

As the population of the world rises it will further strain food production and availability. Vertical farming is the answer – a solution that saves resources and creates a sustainable world. And provides an innovative space for innovation of all kinds. It’s no surprise that vertical farming stocks are doing very well and progressing well.

Vertical farming is a type of agriculture that uses an artificial environment to grow plants in stacks, such as in a greenhouse or indoor farm.

The technique is far from new. However, it is now gaining traction among investors, as several publicly traded companies are vying for your attention.

The list is based on a mix of new and established companies that will allow you to play in this burgeoning space.

APPH AppHarvest $5.20
HYFM Hydrofarm Holdings $14.55
VFF Village Farms International $5.18
AGFY Agrify Corp $7.75
GRWG GrowGeneration Corp $9.20
UGRO urban-gro $9.71
SV Spring Valley Acquisition Corp $10.42

Vertical Farming Stocks: AppHarvest (APPH)

Rows of plants being farmed indoors
Source: Silga Bauge-Robezniece / Shutterstock.com

AppHarvest (NASDAQ:AAPH) designs and manufactures some of the country’s largest indoor farms. Grown without pesticides and GMO-free, the company’s produce is attracting a lot of attention.

AppHarvest is behind a promising farming technique, which can reduce the amount of water needed by 90% compared to traditional field farms. It also utilizes 100% recycled rainwater because it works with the surrounding environment to grow food without disrupting it.

The company was brought to the market through its business combination with a SPAC last year. It has a big pipeline of projects that it could complete by 2025. The company will focus on large indoor farms over the next few decades as demand for indoor options grows. It is already working on completing four facilities this year.

Hydrofarm Holdings (HYFM)

Hand of young man holding a white hydroponic pot with vegetable seedlings growing on a sponge
Source: SukjaiStock / Shutterstock.com

Purchasing stocks in farming companies can be extremely difficult and frustrating. There are several different vertical farming companies, and they can all provide a portfolio with good returns. Choosing the right one comes down to understanding how these companies operate, their economic background, etc.

Hydrofarm Holdings (NASDAQ:HYFM) is one of the best investments in this type of company based on its unique strategy.

Controlled environment agriculture (CEA) has gained traction with various new technologies and innovations over the past few years. CEA is an increasingly viable alternative to traditional agriculture thanks to modern tech like greenhouse automation, hydroponic systems, and vertical farming. The globally controlled environment agriculture market will reach $100 billion by 2030.

Hydrofarm Holdings is a respected name in the industry. It is well-known for its range of products, which has been expanded to include high-intensity grow lights and other unique environments. Therefore, the company is an interesting way to invest in CEA.

Village Farms International (VFF)

Hydroponics,Organic fresh harvested vegetables
Source: bluedog studio / Shutterstock.com

Village Farms International (NASDAQ:VFF) is a Canadian company that specializes in hydroponic technology. Hydroponic farmers use nutrient-rich, sterile water and high-tech lighting to grow plants indoors year-round.

Hydroponic produce has become more common in recent years as it can be grown anywhere, at a low cost, and with less environmental impact.

Interestingly, the company has its marijuana brands and owns a low-cost cannabis producer in Canada. Therefore, if you invest in the stock, you get exposure to the cannabis space, a high-growth area. Therefore, you effectively get two for one price when investing in this stock.

Vertical Farming Stocks: Agrify Corp (AGFY)

bearded man tending kale crops in urban communal garden
Source: Joshua Resnick / Shutterstock.com

Agrify (NASDAQ:AGFY) is a vertical farming company shifting from traditional agriculture to urban agriculture. It targets the cannabis and hemp space with LED grow lights and air purifiers.

The one issue for the company, though, is that it’s still unprofitable, despite revenues increased substantially last year.

After revenue jumped 455% year-over-year, the company managed to get its sales up 481% in Q4. However, the loss figures ballooned. Net loss for the fourth quarter was $13.3 million, or 60 cents per diluted share, versus a net loss of $13.1 million, or $2.23 per diluted share, last year.

Therefore, you need to have patience when investing in this one.

GrowGeneration Corp (GRWG)

Hydroponic indoor vegetable plant factory in exhibition space warehouse.
Source: Nikolay_E / Shutterstock.com

GrowGeneration (NASDAQ:GRWG) provides hydroponic gardening products and services. It has been in the industry since 2008. The company has seen a rise in its business using artificial lighting, hydroponic farming, and the introduction of organic nutrients and soils.

GrowGeneration’s business has grown significantly due to artificial lighting technology. Artificial lighting is a key component of hydroponics because it allows plants to grow faster and more efficiently.

Due to its innovative product portfolio, GRWG is riding high, and you can see that with its fourth-quarter results. Revenue increased 119% to $422.5 million, and net income for the full year was $12.8 million, thanks to an accelerating growth trend. The company operates 63 locations in 13 states. It plans to open 15 and 20 stores during the year and have a long-term goal of being available in all 50 states.

To gear up for this expansion, the company is streamlining its supply chain. And the purchase of Horticulture Rep Group will help in this regard. Hence, the company is on this list of stellar vertical farming stocks.

urban-gro (UGRO)

LED lighting used to grow lettuce inside a warehouse without the need for sunlight
Source: Martin Bergsma / Shutterstock.com

Urban-gro (NASDAQ:UGRO) is the start of an urban farming revolution. It provides fresh, organic produce throughout the year without soil or sunlight.

The company is an urban farming system that can grow fresh produce indoors without soil or sunlight. Urban-gro grows food by using hydroponic technology and LED lighting to cultivate plants. The system has built-in sensors to monitor the environment and adjust accordingly to ensure optimal growing conditions while also eliminating the risk of pest infestation and disease.

Urban-gro reported strong revenue growth in the fourth quarter of 2021. The company managed to reach 140% growth and made impressive income from their investment, with $2.9 million gained in positive adjusted EBITDA versus last year.

Vertical Farming Stocks: Spring Valley Acquisition Corp (SV)

A photo of wooden blocks that say SPAC on a folded newspaper.
Source: Dmitry Demidovich/ShutterStock.com

AeroFarms, a leading indoor farming company, will debut in the market after completing a reverse merger with SPAC Spring Valley Acquisition (NASDAQ:SV). AeroFarms has grown over 550 kinds of fruits, and vegetables, including leafy greens, that it sells to consumers, including Amazon subsidiary Whole Foods.

The company uses technology that solves so many problems caused by traditional farming. It uses 95% less water. And it can produce 390x the amount of vegetables compared to conventional fields. All while providing more healthy food, which makes them better all around.

The SPAC deal will give AeroFarms the funds to expand operations and construct additional leafy greens farms. However, consider the usual SPAC trading process when investing in this one. Near-term catalysts will pop the stock. But expect a drop in the per-share price when the ticker starts trading. In the long run, though, AeroFarms looks like a winner.

On the publication date, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Faizan Farooque is a contributing author for InvestorPlace.com and numerous other financial sites. Faizan has several years of experience in analyzing the stock market and was a former data journalist at S&P Global Market Intelligence. His passion is to help the average investor make more informed decisions regarding their portfolio.


Article printed from InvestorPlace Media, https://investorplace.com/2022/04/7-vertical-farming-stocks-to-buy-before-they-boom-apph-hyfm-vff-agfy-grgw-ugro-sv/.

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