Enghouse Systems (ENGH.TO) Buy, Sell or Hold

Enghouse Systems (ENGH.TO)

16.60

-0.14 (0.84%)

as of Sep 28, 2026, 8:00:00 pm Market Open.

320 watching

TOP PICK

Has held this for a while. A great business that knows how to generate free cashflow. The challenge for them has been that the border has been closed and their due diligence has been slow. Revenue growth should start to grow. As this comes back, investors should start to notice them. (Analysts’ price target is $68.50)

TOP PICK

A software consolidator, generating 90% of revenues outside Canada. Superb managers are buying other software companies and growing cash flow per share. Their last report surprised the street. Has a great platform for growth. 4% cash flow yield is strong. It's down 10% YTD, so attractive to enter now. (Analysts’ price target is $68.50)

PAST TOP PICK

(A Top Pick Sep 08/20, Down 8%) Still likes it. Doubled up when it was down in the spring. Acquisition pace ebbs and flows, and the stock price follows. Great ROIC. Lots of free cash. Pandemic and high valuations have slowed pace of acquisitions. Happy to buy if it goes lower.

BUY

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. Outlook from current levels is good. Management is amongst the best in Canada. Announced some acquisitions recently. Good entry level here. Unlock Premium - Try 5i Free

HOLD

It tends to buy more medium quality assets they can get cheaply. They are good at buying these types of assets and re-positioning them. We have seen some deterioration in their return on invested capital. If you own some, hold it because you won't get hurt by it. The growth rates is similar to its PE so he sees it as fairly valued.

DON'T BUY

Valuation is sky-high, making it vulnerable to the downside. They tripped up a bit on last year's video acquisition. Very acquisitive. Trading at 5-6x revenue, very rich. There may still be downside. Interesting space, but lots of competition. If it got cheap enough, he'd look at it.

BUY

Allan Tong’s Discover Picks ENGH stock remains a low-beta tech name that will perform in the long run, making it one of the best tech stocks to buy. It pays a 1.22% dividend and trades at a 30.1x PE. The street remains bullish on ENGH stock, expecting 30% upside to $67.25. To play it safe, buy a tranche now and see where this stock takes you. Read 3 Best Tech Stocks to Buy Now for our full analysis.

HOLD

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. There is no news or fundamentals to explain the recent weakness. A very solid tech name with great management. It holds excess cash right now. It would be okay to hold today. Unlock Premium - Try 5i Free

TOP PICK

Most revenues come outside Canada. They've done a fine job consolidating companies over the years. Covid has slowed these deals, so Q1 organic growth was negative. They report this week, and organic growth is expected to remain negative. However, they saw a big bump in videoconferencing sales. Long term, their growth profile is strong. The valuation is near its historic lows and a discount to peers. (Analysts’ price target is $74.25)

COMMENT

And Canada tech outlook We have some robust Canadian technology companies and this will only improve in the future. Lots of exciting things here with a lot of money going into it. He sees growth for 5-10 years. But ENGH is struggling. They have a big cloud-based contact centre business that put up massive 2020 numbers but this is rolling over a little and the stock didn't react well. Their transportation software business has been slow to grow. problems are short term. As the year progresses, organic growth will pick up and their cash should lead to acquisitions and raise the stock. Very confident in management.

WEAK BUY

Pulled back on its recent reporting. Price target of $75.40. Price action has been difficult. Latest acquisition was a great asset during the work from home period.

BUY

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. Revenues were 5% short of estimates at $119M. EBITDA increased by 26% and they raised dividends by 18%. As long as growth remains high, investors won’t worry about the miss. Has more than $200M net cash and cash flow continues to improve. Unlock Premium - Try 5i Free

BUY

Great stock, fantastic story. Growth by acquisition. Savvy dealmakers. Pipeline of deals has been pretty strong, but Covid has created a bottleneck. Still generates tons of cash. Deals should be accretive to the stock price. Good time to add.

BUY

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The special dividend will not affect its ability to make acquisitions. The company is well positioned with $251M in cash. Overall very positive. Unlock Premium - Try 5i Free

BUY

A core holding, the small sibling of Constellation. Likes it for its stable income stream. It was expensive early this year, but is cheaper now after a pullback to a reasonable valuation. You may to pay slightly more for it in the current market.

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Enghouse Systems (ENGH.TO)