Opinions
The Panic-Proof Portfolio (Stockchase Research)
Evertz Technologies Ltd.
ET-T
TOP PICK
Nov 12, 2024
Stock price when the opinion was issued
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Premium contentPremium contentET is a leader in software designed for video creation. It recently reported a 10% increase in net income over the year. Their order backlog of $295 million is equal to just under 10 months of shipments. It trades at 14x earnings and supports a 27% ROE. We recommend setting a stop-loss at $10, looking to achieve $17 -- upside potential of 26%. Yield 6.3%
(Analysts’ price target is $17.17)The stock is down because of it moving its business model to SaaS. This basically means that instead of making a big sale up front, the income switches to monthly payments. It generates cash, has no debt and pays a dividend. There are two main owners, each one owning 37 to 38% of the company so there are no bad calls. It has traded at $12 to$17 over the years. Buy 3 Hold 0 Sell 0
(Analysts’ price target is $17.17)Last time, he recommended this as a Top Pick. Niche business, but volatile. No debt. Management owns 60% of shares. When cash builds up, they tend to pay $1 extra in dividends. Cash build is approaching that, so if it can't make an acquisition at a good price, you'll probably get that extra dividend in the next 12-19 months.
Premium contentWe reiterate this developer of HD and Ultra HD broadcast and film industry production software and hardware based in Burlington as a TOP PICK. It trades at 15x earnings and supports a 25% ROE. Recently reported revenues were up over 20% from a year ago with higher margins. We like that cash reserves are growing, while debt is retired and the high dividend yield is maintained. We continue to recommend a stop at $10, looking to achieve $15 -- upside potential of 25%. Yield 6.6%
(Analysts’ price target is $15.42)Premium contentWe reiterate this Ontario based broadcasting and media platform manufacturer as a TOP PICK. Recently reported earnings grew over 60%, allowing the company to reduce debt, buy back shares and still grow cash reserves. It trades at 17x earnings and supports a 25% ROE. We recommend trailing up the stop (from $10) to $11, looking to achieve $15.50 -- upside potential over 18%. Yield 6.5%
(Analysts’ price target is $15.50)Premium contentOur PAST TOP PICK with ET has triggered its stop at $11. To remain disciplined we recommend covering the position at this time. When combined with our previous guidance, this will result in a net investment loss of 9%.
It is held very tightly by its two founders who own over half. It is in the telecommunications space involving television streaming over the Internet and has a nice niche in this market.They are big investors in new technology. Pays a 6% yield and every 3 or 4 years a special dividend of as much as 10% of its capitalization.
We reiterate this Canadian based provider of software and hardware for the video production industry as a TOP PICK. The company recently reported cash reserves are growing, while debt is retired, shares bought back, and the robust dividend is maintained. Their order backlog is growing, margins are expanding and software revenues are up over 25%. We continue to recommend a stop at $10.00, looking to achieve $15.50 -- upside potential over 25%. Yield 6.5%
(Analysts’ price target is $15.42)