Q: Hi, ADF Group announced new contracts for $90 mln in Canada and US. Earnings release is due June 11th. How is the current valuation of the stock vis-a-vis its peers ?
Are you still buyers at $17 ?
Thank You
Are you still buyers at $17 ?
Thank You
5i Research Answer:
We would still consider the stock buyable, but there is some short term risk. A bad quarter would certainly bring out profit-takers after a 579% one-year gain. But it remains well-priced at 12X earnings, and the new orders add visibility on a revenue base of $331M last year. Peer average is 23X but includes some much larger (safer) companies.