Symbility Solutions is well positioned, says Industrial Alliance

Industrial Alliance Securities analyst Blair Abernethy says Symbility Solutions’ (Symbility Solutions Stock Quote, Chart, News: TSXV:SY) second quarter provided more evidence that the company is on the right track.

This morning, Symbility reported its Q2, 2016 results. The company lost $718,000 on revenue of $8.7-million, a 54 per cent topline gain over the $5.6-million the company posted in the same period last year.

“We are pleased to report another new milestone in Q2 of 2016 with our highest quarterly revenue since inception,” said CEO James Swayze. “This quarter saw a 31-per-cent revenue increase in our property segment, with a 24-per-cent increase in health and an overall positive adjusted EBITDA despite the foreign exchange headwinds. We feel confident heading into the second half of the year that we will meet or exceed our guidance considering the increases we are seeing in product utilization across our segments and regions.”

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Abernethy says the results were marginally better than he expected. He notes that the company continue to grow its pipeline of opportunities and is close to an important milestone.

“Symbility has been investing in product and international market development, thus, we expect it to operate close to breakeven EBITDA in the near term,” says the analyst. “We believe that Symbility continues to be well positioned to invest in the expansion of its product offering and further grow its strategic partnerships, thus driving healthy organic growth.

In a research update to clients today, Abernethy maintained his “Speculative Buy” rating and one-year price target of $0.55 on Symbility Solutions, implying a return of 37.5 per cent, including dividend.

Abernethy expects Symbility will post EBIDTA of $100,000 on revenue of $33.6-million in fiscal 2016, numbers he thinks will grow to EBITDA of $1-million on $37.3-million in revenue the following year.

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