Reasons Why MDF's Share Price Has Been Dropping....?
One reason I see for the drop in MDF's share price over the past few months is that many other Canadian tech sector companies have also taken a significant hit over the same time period.
Take a look at some other Canadian small-cap tech services companies over the past three to four months, such as AT, THNK, WE, WISH, etc., all taking significant hits to their share price.
Even larger / more commonly-known tech services stocks like SHOP, LSPD, DSG, KXS, TCS, etc. have taking noticable beatings.
In my view however, the difference is a lot of these stocks (especially the larger names above) became very overpriced during the pandemic mayhem of 2020, and investors are now bringing these companies down to more reasonable valuations, whereas I think smaller names like MDF, given the business they are in and the lack of exposure in the investment community, were more reasonably priced before the tech drop and now even moreso.
If MDF can show great revenue growth in upcoming quarters and more contract wins, I think the market will start to recogninze that it is a great business in two great niches (larger enterprise unified commerce and strategic sourcing) and (hopefully) reward investors with a significant boost to the share price.