Q: Any thoughts about why the price of ADF Group is really tanking today? Today's quarterly result announcement seems pretty positive to me.
5i Research Answer:
Q4 results did miss expectations, with EPS at 31c vs 43c expected; revenue was $77.3M, 3.25% lower than estimates. There was good growth in the quarter and margins were solid. However, the company noted a big drop in its backlog. Uncertainty from tariffs has really impacted customers ability to sign contracts. Sales will be lower this year, largely due to the first quarter. This trend will likely happen with many companies this year: the tariff uncertainty essentially put a halt to a lot of business activity. Backlog is $293M, down from $511M last year. The stock is very cheap, and the balance sheet is fine, but as a small cap with a reduced forecast it will not attract much attention in the current market environment.