By: Philip MacKellar
Published: November 9, 2026
Has Mattr Corp. MATR transformed into a growth stock?
At Contra the Heard, we have owned materials technology company Mattr since 2021 and have watched it for considerably longer. Back when we first bought it, the firm was called Shawcor, and it was a genuine contrarian security.
In 2019, it purchased ZCL Composites, a manufacturer of plastic storage tanks, and unfortunately overpaid. The timingwas also terrible, with COVID-19 right around the corner.
As a result, Shawcor’s income statement suffered massive writedowns in 2020 and 2021. The shares tanked and the analyst community slashed its price targets. However, despite taking a thumping, the balance sheet was strong, the executive team had a clear turnaround strategy and insiders appeared well aligned. These features, plus the low valuations, compelled us to take a stake in the enterprise. Our average purchase price at the time was $4.96, and our sell target was between $20.00 and $25.00.
Then the stock surged out of the pandemic lows. In 2022, we penned a column in The Globe and Mail that argued it was a solid turnaround candidate, and in the summer of 2023, the stock briefly rallied to more than $20.00. We considered selling our stake, but we deliberated for too long. The stock pulled back from our sell range before we could pull the trigger.
In 2024, we wrote another Globe column arguing that the turnaround looked complete. The organization had changed its name from Shawcor to Mattr, divested its oil and gas business and unveiled a 2030 roadmap. This roadmap was broken into two phases.
The first phase involved material capital expenditures through 2025. The main thrust of the initiative was called the “modernization, expansion and optimization” strategy and would expand manufacturing facilities in Ontario, Ohio, South Carolina and Texas. After that modernization push, management envisioned a second phase featuring annual sales growth of more than 10 per cent a year through 2030 and expanding EBITDA margins to more than 20 per cent.
As 2025 approached, everything looked on track, but then the C-suite decided to purchase a U.S.-based wire and cable business called AmerCable for US$280-million, or approximately $390-million at the time. This transaction increased the company’s exposure to the U.S. cable market – a fortuitous decision given it feeds directly into the AI data-centre build-out. It also generated cross-selling opportunities for the rest of the business and helped reduce some of the effects associated with U.S. President Donald Trump’s tariffs. The merger was expected to grow sales, boost EBITDA margins and propel earnings per share as well.
The trade-off was that this deal was risky. To finance the transaction, Mattr slashed its cash cushion and took out a lot of debt. In addition to the financing headwind, the buyout exposed Mattr to integration risks. Consequently, through much of 2025, the ghost of the ZCL Composites acquisition loomed large in our minds.
As we entered 2026, we watched the story closely and thought buying more Mattr could be appropriate if the AmerCable synergies emerged, leverage decreased and valuations dropped. These features coalesced in late March after the firm reported decent fourth-quarter numbers, debt started moving in the right direction and the stock market tanked in response to the Iran conflict. Therefore, we bought more at $8.76, which brought our average purchase price to $6.20.
In the months that followed, the benefits of the AmerCable acquisition started to pay off. The data-centre build-out boomed and was accompanied by robust demand in the renewable energy and mining sectors. This drove healthy sales and margins, and the C-suite repeatedly increased the 2026 outlook in response. Although the performance and guidance were encouraging, by early October the valuations were looking stretched and the data-centre hype was running into meaningful financing friction and political risk. In response, we reduced our stake that month by roughly a third at $21.99. This translated into a gain of 254.7 per cent. Since the sale, the stock has fallen back below $20.00.
By taking a third off the table, we are acknowledging the risks of the AI bubble popping and the data-centre build-out stalling. Yet, by keeping two-thirds invested, we are exposing ourselves to the possibility that – even if this current AI-driven business cycle ends badly – the long-term (multicycle) growth story associated with Mattr’s various businesses is strong.
So, has it become a growth stock? Maybe. The ingredients are there, and, as we have discussed in recent articles on Bird Construction and Enerflex, M&A can result in a materially higher share price over time if the acquisition is done on the cheap, the integration goes well and debt is paid down. For the time being, however, the risks associated with the AmerCable acquisition have not disappeared. Mattr’s debt remains relatively high, and the data-centre boom could turn to bust. This outcome could nullify a lot of AmerCable’s value in the process. Moreover, management has yet to prove this new corporate orientation will flourish over many market cycles.
That said, it is reasonable to think the company is in the process of turning into a growth stock, and it merits close observation. If that is indeed the case, our goal will be to sell the remainder of our stake in slices and gradually increase the sell target as the story evolves. In the meantime, our sell target has inched up slightly to a range of $21.00 to $26.00.