D-Box Technologies has 281 per cent upside, Echelon Wealth says

While he was disappointed with the company’s third quarter performance, Echelon Wealth Partners analyst Rob Goff nonetheless thinks there is huge upside in D-Box Technologies (D-Box Technologies Stock Quote, Chart TSX:DBO).

Goff says the growing importance of marquee “event” movies reinforces attractive theatre economics from a premium experience.

“We continue to view D-BOX as an exceptionally attractive, catalyst-rich member of our Top Picks Portfolio,” the analyst says. “Our bullish outlook considers product and geographic expansion as potentially significant catalysts to achieving results significantly above our baseline forecasts. We are optimistic that the YTD success of Black Panther (number 9 all-time box), The Avengers: Infinity War (number 4 all-time box)and Incredibles 2 will provide a catalyst for incremental theatre wins (deployments/pilots).”

In a research update to clients today, Goff maintained his “Speculative Buy” rating and one-year price target of $0.80 on DBO, implying a return of 281 per cent at the time of publication.

Goff thinks D-Box will generate EBITDA of $2.4-million on revenue of $38.7-million in fiscal 2019.

“We remain encouraged by D-BOX’s ability to sign additional theatre and second screens with existing clients,” the analyst adds.  “We noted on May 15 that D-Box had signed a contract to add D-BOX seating for 18 screens with Kinopolis, the largest independent cinema operator in Germany. We are encouraged to see additional orders from an existing client as Kinopolis currently has nine screens outfitted with D-BOX seating. We note that Cineplex announced on April 20/18 that it opened its 83rd location with D-BOX motion seats. The theatre chain has also deployed D-BOX VR Cinematic Experiences in three locations within the past year.”