Opinions
Bruce Campbell (2)
Avigilon Corp
AVO-T
PAST TOP PICK
Dec 10, 2014
Stock price when the opinion was issued
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Makes high definition security cameras. They originally started mostly on the hardware side, but now are really starting to move into the software side. The artificial intelligence they have and the bundle between hardware and software is becoming more user-friendly, saving their users a lot of time and labour as well. (Analysts’ price target is $20.)
Video surveillance technology. Just announced they are going to be launching a sort of software service product, and the market loves recurring revenues. Too early to get excited about that, but it’s interesting. They’ve had communication issues with the market in the past, which is what led to a lot of the downdraft. However, they’ve shifted strategies and are now focused on profitability. The last 2 quarters beat earnings estimates by 50% and just shy of 40%. Has a lot of cash on the balance sheet with the sale of a Vancouver property that is just going through now. (Analysts’ price target is $22.75.)
He likes this. They are ticking every box. Has a strong balance sheet, a property in Vancouver they are looking to sell, and valuation is pretty cheap. Good earnings growth and good revenue growth. They’re also looking at a new business where they are going to be doing software as a service business model, and markets really like software service businesses, because it is high margin, predictable types of revenue. They've been blowing out estimates over the last 2 to 3 quarters.
(A Top Pick Jan 15/14. Down 50.32%.) High definition surveillance cameras. Sold his holdings in the $28 range in February, when it broke down from a supply/demand perspective. Revenue numbers were great on the quarters following that, but they were spending a lot of money to generate that revenue, and the earnings numbers were a lot weaker than what the street had expected. Still has this on his radar screen. They continue to grow and execute very well. Another quarter like the last one, and there is a pretty good chance that he could be looking at this again. Have started to integrate their systems, so it is not just the cameras that they were once selling, but their whole software solution as well.