Profit per employee. Which Canadian tech stocks generate the most?

What’s the best way to value a company? Ask three analysts and you might get three answers.

“Amazon’s topline growth will enable it to dominate online retail in the future,” one might say. “Apple’s ability to charge a higher price for its products puts cash straight to the bottom line,” would be the answer from another. “Cisco’s dividend lets investors ride out a flat performance in its share price,” you might hear a third declare on CNBC.

Perhaps they are all right. Or maybe none of them are.

“Most measurements of performance are geared to the needs of 20th-century manufacturing companies. Times have changed. Metrics must change as well,” says McKinsey Quarterly’s Lowell L. Bryan. Bryan says measuring the profit generated per employee might be the most accurate measure of all in determining a company’s real value.

“(An) advantage of profit per employee is that it requires no adjustment for accounting conventions,” he said in his 2007 piece. “Since companies expense their spending on intangibles but not on capital investments (which are usually depreciated over time), profit per employee is a conservative, output-based measure. And since it is based on accounting conventions, companies can easily benchmark it against the comparable results of competitors and other companies. Profit per employee therefore focuses companies on intangible-intensive value propositions and, in turn, on talented people—those who, with some investment, can produce valuable intangibles.”

So which Canadian technology companies generate the most profit per employee? We scanned the TSX Technology Index for stocks that were profitable in their most recent quarter, then ranked them here. Employee count comes courtesy of Globe Investor, excepting where that was not available, in which case we found an alternate, recent source.

1. Wi-LAN (TSX:WIN)
Net Income from Most Recent Quarter: $2.43-million
Employees: 47
Quarterly Profit per Employee: $51,702

Fiscal 2013 was not a great year for Wi-LAN, but the company did deliver a surprise Q4 on the last day of January, posting a $2.4-million profit. “Our determined effort overcame litigation setbacks to sign licence agreements with many defendants including BlackBerry, HTC and Sierra Wireless. These agreements contributed to our strong revenues and adjusted earnings in the fourth quarter,” said CEO Jim Skippen.

2. Computer Modelling Group (TSX:CMG)
Net income from Most Recent Quarter: $5.61-million
Employees: 175
Quarterly Profit per Employee: $32,057

Stability. Having more than 80% of its software license revenue come from from annuity and maintenance contracts allows Calgary’s Computer Modelling Group to be one of a handful of Canadian techs that pays a dividend. CEO Ken Dedeluk says he expects that will only continue. “The excellent reputation behind our Company and its product suite offering will continue to enable us to grow and sustain a healthy market share while generating solid software license revenue,” he said after the company’s recent quarter. “With our strong working capital position, we are well positioned to continue to invest in all aspects of our business in order to continue to grow and diversify our revenue base and to ultimately return value to our shareholders in the form of regular quarterly dividend payments and growth in share value.”

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3. Catamaran Corp. (TSX:CCT)
Net income from Most Recent Quarter: $72.9-million
Number of employees: 3300
Quarterly Profit per Employee: $22,090

Catamaran is the most successful Canadian-born company that no one seems to know. The now U.S.-based healthcare technology giant, which was once known as SXC Health and hailed from Milton, Ontario, has grown its revenue from next-to-nothing to a current run rate of nearly $15-billion, after posting a topline of $9.9-billion in fiscal 2012.

4. Information Services Corp (TSE:ISV)
Net income from Most Recent Quarter: $6.67-million
Employees: 315
Quarterly Profit per Employee: $21,174

Saskatchewan’s Information Services Corp. manages land title and land survey registries and does so profitably. The company’s CEO Jeff Stusek says ISC may look to expand, geographically. “We are focused on continuing to increase our value proposition to Saskatchewan residents and businesses by expanding our services and offerings,” he said after the company’s recent Q3. “At the same time, we have the balance sheet strength to grow beyond our provincial borders and provide solid dividend returns to shareholders.”

5. Avigilon (TSX:AVO)

Net income from Most Recent Quarter $8.62-million
Employees: 450
Quarterly Profit per Employee: $19,155

The most successful Canadian tech IPO in recent history just keeps moving upward. Avigilon’s Q3, reported early in November, blew away the street’s expectations. CEO Alex Fernandes says the company is executing. “Our strategies are working, and we will continue to invest to expand our global sales team, expand our product portfolio, and increase marketing efforts,” he said in a note accompanying the results. “Combined with healthy underlying growth in the high-definition surveillance market, these strategic investments position us well to deliver sustainable long-term growth.”

6. Evertz (TSX:ET)
Net income from Most Recent Quarter: $15.42-million
Employees: 990
Quarterly Profit per Employee: $15,575

After a Q2 in which the company earned $15.62-million on revenue of $81.2-million, a $17.3-million rise over last year’s second quarter, Evertz was upgraded by three different bank and, curiously, downgraded by one.

7. Tucows (TSX:TC)
Net Income from Most Recent Quarter: $2.59
Number of employees: 200
Quarterly Profit per Employee: $12,950

Tucows whose name is based on the acronym for The Ultimate Collection of Winsock Software, is now into domain registration, and is the third largest ICANN-accredited registrar in the world. The company’s stock rose steadily all year on the back of improving numbers; the company’s Q3 revenue, reported November 13th, increased 22% to a record $35.6 million.

8. Sandvine (TSX:SVC)
Net Income from Most Recent Quarter: $5.64-million
Employees: 521
Quarterly Profit per Employee: $10,825

Cantor Fitzgerald analyst Blair Abernethy says he expects that Sandvine will gradually shift its business to that of a pure software company because industry adoption of network virtualization technology will increase in the years to come. He says the company’s recent $33-million bought deal puts it in a better position to build and acquire technology.

9. Points International (TSX:PTS)
Net Income from Most Recent Quarter: $1.15-million
Number of Employees: 124
Quarterly Profit per Employee: $9274

Toronto-based Points International lives at the corner of technology and loyalty programs, which these days is a good place to be. Points International manages the back end of loyalty currencies, frequent flyer miles, hotel points, retailer rewards and credit card points. The company has more than fifty partners worldwide including Delta, BestBuy, Starbucks and PayPal. Points has grown its revenue from $30 million in 2007 to $139.5-million fiscal 2012.

10. Mediagrif (TSX:MDF)
Net Income from Most Recent Quarter: $2.81-million
Number of Employees: 310
Quarterly Profit per Employee: $9064

Founded in 1996, Longueuil, Quebec-based Mediagrif offers a range of e-commerce services through B2B platforms such as The Broker Forum, Power Source Online, and Carrus Technologies. The company became increasingly profitable as it grew its revenue from $47.9-million in 2009 to $53.8-million in 2012. In its recent Q2, 2014, Mediagrif earned $2.81-million on revenue of $16-million.

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