Still big returns to be had on Alarmforce, says Industrial Alliance

Without its founder and longtime leader Joel Matlin, who was fired by the board in July, Alarmforce (TSX:AF) may seem unsettled, but the company’s stock represents excellent value, says Industrial Alliance Securities analyst Steve Li.

On Wednesday, Alarmforce reported its Q3, the company earned $2.84-million on revenue of $36.47-million, a 9% bump from last year’s Q3 topline.

Anthony Pizzonia, who became Alarmforce’s interim CEO following the departure of Matlin, laid out his plan for Q4.

“For the remaining balance of the fiscal year, we will focus on growing our subscribers, increasing operating efficiencies, pursuing accretive investments that drive organic growth, and returning excess cash to shareholders in the form of both dividends and share buybacks,” he said.

Li, who says the results were in line with his expectations, notes that there have been no signs of a disruption at AlarmForce. He says the growth of the company’s customer base should remain in the high teens. The Industrial Alliance analyst is particularly impressed with the uptake of the company’s VideoRelay product, which added 1000 new subscribers in the quarter.

In a research update to clients this morning, Li maintained his STRONG BUY rating and $12.75 one-year target on AlarmForce.

Shares of Alarmforce closed today up 1.6% to $9.80.

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