Syncordia Technologies is hugely undervalued, says Mackie Research

Some good news from Syncordia Technologies (Syncordia Technologie Stock Quote, Chart, News: TSXV:SYN) is confirming Mackie Research Capital analyst Nikhil Thadani’s bullish take on the stock, says the analyst.

Yesterday, Syncordia announced that its wholly owned subsidiary, Health Services Integration, was “pushing through initiatives” that will add over $1-million annually to the bottom line, annually. The company also said that Billing Solutions, which it owns 80 per cent of, was in the process of signing contracts that would add $300,000 in annualized EBITDA, and that its wholly owned subsidiary Paragon Billing would also be adding $300,000 in EBITDA annually, from new contracts.

Thadani says these developments should begin to unlock value from Syncordia’s stock.

“Meaningful EBITDA improvements due to organic revenue growth and operational improvements announced last night could facilitate debt re-financing and possibly value potentially to be divested assets higher,” says the analyst. “Once these 2017 debt hurdles are overcome, we expect meaningful stock price appreciation as the stock should be valued on the company’s expected cash flow, which is currently muddied as new contracts are on-boarded.”

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In a research update to clients today, Thadani maintained his “Speculative Buy” rating and one-year share price target of $1.00 on Syncordia Technologies, implying a return of 355 per cent at the time of publication.

Thadani believes Syncordia will lose $5.3-million on revenue of $16.31-million in fiscal 2017. He expects these numbers will improve to a loss of $2.01-million on a topline of $19.43-million the following year.

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