Zedcor is a buy, this analyst says

Beacon Securities analyst Gabriel Leung reiterated a “Buy” rating and C$7.25 price target on Zedcor (Zedcor Stock Quote, Chart, News, Analysts, Financials TSXV:ZDC), saying the company’s expanded credit facility meaningfully improves capex flexibility and growth visibility.

In a Feb. 3 report, Leung noted that Zedcor has increased its committed credit facility to $75-million from $50-million, while retaining access to an additional uncommitted $25-million accordion, taking total potential borrowing capacity to $100-million.

As of the third quarter, the company had drawn approximately $24-million, a figure Leung expects has since risen given the pace of tower deployments and capital spending.

The terms of the facility are otherwise unchanged, with a three-year maturity from closing and covenants including a net funded debt-to-EBITDA ceiling of 3.5x and a fixed charge coverage ratio of 1.15x. Based on its current financial position and outlook, Zedcor expects pricing of Prime plus 0.75%.

Leung said the expanded facility should provide more than sufficient liquidity to support Beacon’s calendar 2026 and 2027 growth and capex assumptions. He also highlighted that Zedcor’s new manufacturing facility and monitoring centre in Houston, Texas, is now operational, lifting tower production capacity to more than 50 units per week.

“Overall, we view today’s news as being positive for the company,” Leung said, adding that the next key catalyst is Zedcor’s Q4, 2025 results, expected in late March or early April.

For the fourth quarter, Beacon is modelling revenue of $18.4-million and Adjusted EBITDA of $6.1-million, compared with consensus expectations of $18.4-million and $6.4-million.

Leung forecasts that Zedcor will generate $20.9-million in Adjusted EBITDA on $59.5-million of revenue in fiscal 2025, improving to $38.1-million in Adjusted EBITDA on $105.1-million of revenue in fiscal 2026.

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