With partners like Walgreens, PNI Digital Media is well positioned to benefit from mobile photography trends, says analyst Justin Kew.A new study suggests mobile phone users are embracing photo output products, and that is good news for Vancouver’s PNI Digital Media (TSX:PN), says Cantor Fitzgerald analyst Justin Kew.
In a research update to clients yesterday, Kew maintained his SPECULATIVE BUY rating and $1.85 one-year target on PNI Digital Media, implying a 41% return at the time of publication.
Kew points to the study from research firm Suite48Analytics, which polled 1,641 North American mobile photographers in North America. About 55% of smartphone photographers have experience with ordering photo output products, such as photo prints, photo books, calendars and cards, revealed the study.
The Cantor Fitzgerald Canada analyst says the report validates PNI’s mobile strategy that focuses on developing apps for ordering photos from any device, cloud integration, and partnering with Samsung on a native photo application. The study found that these factors were, in fact, critical to mobile photographers.
Shares of PNI Digital Media took flight in the latter half of 2013. The company, which announced deals with household names like Walgreens and Office Depot, says it is seeing growth in the photo market spurred by higher value items such as photo books and canvases. Management says a key development was transitioning its clients to a model in which it gets paid based on percentage of retailer’s revenue earned instead of the number of photos they upload.
At press time, shares of PNI Digital Media were up 1.5% to $1.37.