A "Decent" Quarter Could Launch this StockThe company is scheduled to report on Tuesday after the close. Here are my estimates ("guess") for what to expect on the quarter (and shortly thereafter).
For Q2, I'm forecasting revenue of $71.5 million, adjusted EBITDA of $4.5 million and EPS of $0.10. Those aren't spectacular numbers by any means. The estimates imply 10% organic declines and organic EBITDA margins of 4.0% (below Q1). I'm estimating acquistion EBITDA contribution of $2.0 million (that's where most of the improvement comes from).
Now, for 2017, I'm estimating $19 million adjusted EBITDA. That's below guidance. But at this point who cares. If the company can do $19 million of EBITDA that means two things.
(1) Net debt to EBITDA declines to below 2.0x in Q4, which positions the company to close another deal early in the quarter.
(2) If valuation normalizes, the stock should re-rate to above $2/share.
A few sellers are dragging this one down ahead of the quarter. And buyers look timid.
Results from Supremax and RRD haven't made any longs feel good enough to step in ahead of the quarter. But we're lapping low numbers and valuation is depressed here...let's see.