Following the company’s first quarter results, PI Financial analyst David Kwan is maintaining his “Buy” rating on Quorum Information Technologies (Quorum Information Technologies Stock Quote, Chart TSXV:QIS).
On May 30, QIS reported its Q1, 2019 results. The company posted EBITDA of $757,000 on revenue of $7.35-million, a topline that was up 109 per cent over the same period last year.
“This is Quorum’s first quarter as a combined Company following our recent acquisitions, the latest being Oasis in January 2019,” CEO Maury Marks said. “Today we are reporting the combined results from the XSellerator, DealerMine and Autovance divisions, and the newly acquired Oasis division.”
Kwan notes that Quorum’s revenue came in higher than his expectation of $7.0-million and the street consensus of $6.9-million.
“Momentum is continuing to build on the back of the acquisitions of DealerMine and Oasis in recent quarters, with a pickup in revenue growth and FCF generation. With the strong revenue growth expected to continue, aided by the large cross-selling opportunity, the launch of new products, and ramping up business from new OEM certifications, and given the strong cost control, QIS’ fundamentals look poised to continue on its upward trajectory. The stock has moved up in the last couple of months on the back of the stronger performance but the valuation multiple has not, leading to the stock continuing to trade a very attractive multiple (just 1.7x EV/Sales on our FY20 forecast).”
In a research update to clients today, Kwan maintained his “Buy” rating and one-year price target of $1.25 on Quorum Information Services.
Kwan thinks QIS will post Adjusted EBITDA of $4.9-million on revenue of $30.6-million in fiscal 2019. He expects those numbers will improve to EBITDA of $6.8-million on a topline of $34.0-million the following year.
Leave a Reply
You must be logged in to post a comment.
Comment