TSX:DSG - Post Discussion
Post by
luberon on Jun 23, 2020 9:39am
The Motley Fool on DSG
Descartes Systems: Buy on volatility
The second stock that I would buy if the market crashes again is Descartes Systems (TSX:DSG)(NASDAQ:DSGX). Descartes provides technological and network services for the global logistics industry. Trade tensions, virus restrictions, and the rise of e-commerce are all causing supply chains to become increasingly complex. Descartes is set up perfectly to help business with optimizing supply-chain/logistics through its software and networks.
Despite a challenging pandemic environment, Descartes demonstrated strong first-quarter results. It is sitting on a net cash position of US$46 million. This will help fuel organic and acquisition growth initiatives. Descartes targets annual adjusted EBITDA growth between 10% and 15%.
Descartes is up 18% year to date and is trading with a price-to-earnings and price-to-sales multiples of 65 times and 12 times, respectively. Yet this is a super-high-quality stock, so I would use another market crash or decline to average in.
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