TIO Networks Is Still Undervalued, Says Haywood On December 15, TIO Networks will report its first quarter, 2017 results.
Sangha expects TIO will report Q1 EBITDA of $3.3-million on revenue of $25.6-million, which would be 67.7 per cent better than the same period last year. He notes this is higher than the consensus revenue estimate of $24.8-million, but in-line with consensus EBITDA.
The analyst thinks TIO will continue to derive benefit from its transformational Softgate acquisition.
“Tio is expecting revenue growth to benefit from cross-selling opportunities between Tio and Softgate, for instance Tio plans to expand Softgate’s PayXchange product across all Globex locations,” he says. “We expect operating expenses to decrease in Q1 due to the elimination of one time severance and integration expenses that impacted Q4FY16 but won’t repeat going forward. Management does not expect OPEX to increase significantly for FY17.”
In a research report to clients today, Sangha maintained his “Buy” rating and one-year price target of $3.00 on TIO Networks, implying a return of 15.4 per cent at the time of publication.
Sangha believes TIO will generate EBITDA of $16-million on revenue of $107.3-million in fiscal 2017. He expects these numbers will improve to EBITDA of $20-million on a topline of $115.5-million the following year.
Link: https://www.cantechletter.com/2016/12/tio-networks-still-undervalued-says-haywood/