Blackline Safety Corp (Blackline Safety Corp Stock Quote, Chart TSXV:BLN) has snagged another large customer win, a move which helps diversify the company beyond the oil and gas sector, according to David Kwan, analyst for PI Financial.
“As we had expected, BLN has seen a pick-up in large customer wins in recent quarters to complement its steady stream of small- to medium-sized initial and follow-on orders and we expect this pick up in momentum to continue (we know of at least one other large deal that is in the works but there are likely numerous others in their robust pipeline), which should translate into more quarterly revenue records,” Kwan said in a research update Tuesday.
Yesterday, connected safety tech company Blackline Safety announced that Yorkshire Water, a UK water and sewage company that serves one of the UK’s largest counties has placed a $1.9-million order for Blackline’s products through the company’s distribution partner Breathe Safety.
The customer win shows that contrary to some perceptions, BLN is not heavily dependent on the oil and gas industry, says Kwan, who points out that the company has gotten large deals across different end markets, including utilities, government, water and waste water as well as oil and gas.
Kwan is taking the Yorkshire Water deal as a positive for BLN. He is leaving his estimates as is but says that the deal provides “additional comfort” for his projections. The analyst is calling for fiscal 2019 revenue and Adjusted EBITDA of $33.1 million and $0.4 million, respectively, and fiscal 2020 revenue and Adjusted EBITDA of $50.2 million and $7.9 million, respectively.
Kwan is maintaining his “Buy” rating and $7.75 target price, representing a projected 12-month return of 38.4 per cent at the time of publication.