Q: Please comment on results- does this company have the potential to recover and what would be a good entry point?
5i Research Answer:
EPS missed estimates of 26c coming in at 16c. Revenue was $652M declining 2% year-over-year, and missing estimates of $682.4M. Guidance for the full-year was significantly cut and also missed analyst forecasts. The company cited a "challenging macroeconomic environment and competitive conditions in the industry" as to why demand has slowed down. The company's CEO announced retirement as well. This was a very bad quarter to put it lightly and demand just does not seem to be there for TIXT while the Willow Tree acquisiton may have also not been a great decision. A turnaround is possible with the leaderhsip shakeup, but there are likely deeper issues with TIXT and we are staying away even as the stock is very cheap at 4x forward earnings.