A quarter that came in slightly below his expectations isn’t damping Industrial Alliance Securities analyst Neil Lindsell’s enthusiasm for Exco Technologies (Exco Technologies Stock Quote, Chart, News: TSX:XTC).
Yesterday, Exco posted its Q1, 2016 results. The company earned $11.8-million on revenue of $130.9-million, up nine per cent over the same period last year. The company also announced that it will raise its dividend by 17 per cent to seven cents a share.
Lindsell says Exco’s top and bottom line were slight misses against his forecast. But the analyst says the company’s outlook remains strong, with a strong auto market set to support its growth and losses at the company’s greenfield facilities expected to tail off.
“Exco’s outlook remains positive, with a strong automotive market continuing to be supported by multiple factors and trends. The Company expects resilience of the quoting environment amongst auto suppliers to continue, with increased quoting activity to be undertaken by the Automotive Solutions Group at Exco, in pursuit of refreshing existing programs and new content. Management highlighted key trends in the auto market that we have touched on in our previous research update1. Losses are expected to decline gradually at the greenfield facilities as the ramp-ups continue and the facilities reach higher operational and efficiency levels.”
In a research update to clients today, Lindsell maintained his “Top Pick” rating and one-year target price of $20.00 on Exco Technologies.
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