Sentiment in Small Caps can be a Cruel Mistress… Small Cap names are naturally more susceptible to market inefficiencies but these extremes can lead to opportunity when Joe the home gamer stock guru blows out or rushes into a position regardless of price.
Retail traders like to invest in a story from a management team ( see PHM or CXR). This is what the PTG team has to do a better job of. I agree they are a new team but this is what will turn retail sentiment.
Take for example smaller cap tech names that have already rocketed higher in 2016 on a flip in sentiment. (VCM, SYZ, Y, WIN). The fundamentals have not nearly changed as much as the underlying stock price it is a shift in sentiment and re rating of the multiple.
PTG has a lot of run room on both fronts especially the re rating of the multiple.
I believe there will be a flip in sentiment as the Canadian tech sector gets revalued based on relative value to US tech.
I have begun accumulating smaller Canadian tech stocks that are well off their highs that are hated by retail for causing them mountainous losses where they have been basing over the last several months and the fundamentals continue to improve and the market doesn’t even care. All of them could easily double just with a change in sentiment and multiple re rating within 12 months, some of them are trading so cheap I think one or two could easily get taken out.
These are all in my basket of Misfits;
1. Pivot Technologies (PTG.TO)
2. Perk.com (PER.TO)
3. Tucows Inc. (TC.TO)
4. NYX Gaming (NYX.TO)
5. TheScore (SCR.TO)
Just my thoughts…