National Bank Heading into fourth-quarter earnings season in the Canadian technology sector, National Bank Financial’s Richard Tse and John Shao see “potential downside bias” for commentary around financial guidance for the year ahead.
In a research report released Thursday, the equity analysts also predicted more companies will undertake restructuring (particularly some of the more recent IPOs) as they pivot their narratives towards profitable (more disciplined capital allocation) growth.”
“We expect balance sheets for some companies to be the focus of investor attention given the challenging macro backdrop with limited (attractive) financing potential,” they said.
The analysts pointed to five companies with potential upside from the Q4 results: Coveo Solutions Inc. ; Kinaxis Inc. ; Nuvei Corp. ; Shopify Inc. and Tecsys Inc.
Stocks with potential downside risk are: E Inc. ; Farmers Edge Inc. ; Q4 Inc. and Real Matters Inc.