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  5. E: I have a question about 1278 Could the team comment on Enterprise Group? [Enterprise Group Inc.]
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Q: I have a question about 1278


Could the team comment on Enterprise Group?

Thanks

Dan

Asked by D.B. on December 14, 2023
5i Research Answer:

With a market cap of barely $19M at the start of 2023, it is not one we have paid a lot of attention to. But it has had a good year, and with a 97% gain market cap is now $37M. Still small, but certainly getting noticed. It is very cheap at 7X earnings, and is essentially debt free. It is profitable, with $11M in cash flow in the last 12 months. It is very closely tied to the energy sector, and its customers are in good shape. Insiders own 41% so only Fundamental Research covers it. It has won some new contracts recently and has a stock buyback in place. Sales rose 60% in the last quarter. Overall, for a micro cap, it reads quite well, if one can handle the cyclicality of the business, no dividend, the small market cap and the very tight trading float.