RE:Sylogist Beats Earnings Expectations and Punished For ItI just jumped into this stock based on the weakness. But it's so volatile that I'll probably be buying over a period of time to DCA until we hit bottom.
Issue IMO is just that they had the wrong investors coming from the prior mentality of underinvesting in their business and paying out all cash flow as dividends. This is pretty common historically when you have a company that tries to transition from a conservative dividend payer to a growth story. If you touch dividends, you get wrecked regardless of the reason.
Income investors are not interested in investment, M&A or hiring new sales executives (which is what is dropping their EBITDA margin). So the investors have to switch from the income investors over to the growth investors which will be painful in the short term.
I would make the argument that the new CEO has executed on everything he said he was going to do over the last year, results are right on and they are getting ready for a big year.