Welcome to the first installment in our "Head to Head" series. In "Head to Head" we\nuse basic value metrics to compare a large Canadian tech stock to a small one in a\nsimilar space. Clearly, there are caveats and\nqualifiers necessary (growth, for instance is much more important to smaller stocks)\nin such a comparison. Nonetheless, we think it's a useful exercise to try and level\nthe playing field to see if David can take down Goliath. In the first matchup,\nupstart OSI Geospatial (TSX:OSI) plays the role of David against the Goliath that is\nMacDonald Dettwiler (TSX:MDA).\n\nFirst,a little about the pugilists: Founded in 1977, Ottawa based OSI Geospatial\n(OSI) develops and sells "command and control" technologies and navigation systems\nfor the defense and homeland security markets. In the past four quarters, to May\n31st, 2009 OSI's revenue was $26.4 million. \n\nRichmond, BC based Macdonald Dettwiler and Associates (MDA) was founded in 1969. MDA\nis a diverse provider of information solutions. One of the company's key units\nprovides geospatial information systems for aerospace and defense industries. In the\ntrailing four quarters, to June 30th, 2009 MDA did $1.074 billion in revenue. \n\nLet's get started by seeing how these two from opposite ends of the weight class\nfare in the most basic of tests, price to sales:\n\n1. Price to sales: \nOSI 0.30\nMDA: 1.18\n\nA big difference here; OSI's market cap of 8.04 million (47.28 million shares\noutstanding multiplied by the closing share price at September 18, 2009, which was\n.17 cents) pales in comparison to its trailing revenues of 26.4 milion. This price\nto sales ratio of 0.30 would put OSI in the top third of all DVC Smalltech profiled\ncompanies. MacDonald Dettwiler, on the other hand has nearly doubled off its October\n2008 lows of approximately $16 and now trades above one times sales again. MDA's\nmarket cap is now 1.27 billion (40.47 million shares multiplied by a closing share\nprice of $31.31 on September 18th, 2009)while its revenue in the trailing four\nquarters was $1.07 billion.\n\n\n\n2. Cash and Short term investments to market cap:\n\nOSI: 6.3%\nMDA: 2.97%:\n\nWhen compared to their market caps, Neither OSI nor MacDonald Dettwiler could be\ncalled cash rich. With just $510,000 in cash and short term investments as of May\n31st, 2009 OSI has just 6.3% in the bank. But MDA falls even shorter. With just\n37.68 million in the bank as of June 30th, 2009 MDA has just 2.97% of their market\ncap at hand. \n\n\n\n3. Debt to market cap:\n\nOSI: Zero\nMDA: 34.1%\n\nOSI, like many of the DVC Smalltech Letter profiled stocks carried no long term debt\nas of May 31st, 2009. MDA, on the other hand, might be described as "debt-laden". On\nJune 30th, 2009 MDA reported just over $432 million in long term debt, or just over\n34% of its market cap. Of course many would argue that MDA wouldn't be a heavyweight\nat all if it couldn't access and manage a large debt load. \n\n\n\n4. Trailing three year growth rate:\n\nOSI: 35.5%\nMDA: 12.6%\n\nMDA has done a lot of growing since 1969 and, considering its size, that double\ndigit growth rate is impressive. MDA grew from just over $832 million in revenue in\n2005 to $1.16 billion in 2008. In actual dollars, OSI's growth is pocket change to\nMDA, but a 35.5% annualized growth rate over three years is impressive regardless of\nthe size of the company. That number would place OSI in the top third of all DVC\nSmalltech Letter profiled companies. \n\n5. Enterprise Value to Sales:\n\nOSI 28.5%\nMDA 155%\n\nEnterprise value is the really the metric that answers the question "How much love\ndoes the market have for your company?". Unfortunately for OSI at this time, as with\nmany small Canadian techs, the answer is "not much". Here we compare each companies\nEnterprise Value (The formula for calculating EV is Market Cap + debt - Cash and\nshort term investments). and express it as a percentage of their sales. The market\ngives OSI an Enterprise value of just over $7.5 million, while sales from their\ntrailing four quarters were 26.4 million. OSI certainly has a lot of room to grow\ninto the public profile of MDA, whose EV clocks in at just over 1.6 billion, while\nsales from the trailing 4Q's totaled just $1.07 billion.