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  5. VCM: Please comment on the latest Q and the co. [Vecima Networks Inc.]
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Q: Please comment on the latest Q and the co. Bought a small position in 1980's.Down 8.37% last week. Add,Hold or Sell. Are U covering the co.in due course,recollected that it was under consideration some time ago Txs for u usual great services and views
Asked by Peter on June 04, 2024
5i Research Answer:

VCM  beat EPS expectations of 27c, coming in at 31c. Revenue also slightly beat estimates of $79.85M, coming in at $80.1M and displaying growth of 2.4% year-over-year. Management highlighted this quarter waas an,"All-time Best Quarterly Performance." Profit margins continued to improve in the quarter, in particular adjusted EBITDA margin was 47.2%, up from the prior year levels of 38.1%. This was a solid quarter from VCM shaking the prior quarters declining revenue trends and continuing to improve margins. VCM continues to be cheap at 12.1x forward earnings. We think VCM is moving towards add territory with this strong quarter, however we are still a bit hesitiant due to stability in future revenue growth. Outlook for 2025 appears positive, so we will consider covering VCM if it is able to effectively display a turnaround in growth.