Investorfile blog first took notice of Sangoma Technologies Corp. (TSXV: STC -
C$0.71) at C$0.21 per share over three years ago (See: Sangoma Technologies: A small cap
tech stock trading for value with prospects of growth). Just
three months ago we took notice again with the shares trading at C$0.43 (See: Sangoma Technologies’ stock price
has room to double again).Today the stock trades at
C$0.71, up 240% since we first recommended Sangoma Technologies to our list of
Top Ideas. Based on recent financial trends, we remain bullish as ever on the
Company and its stock as a small cap investment opportunity.
Technologies delivers Unified Communications solutions for SMBs, Enterprises,
OEMs, Carriers and service providers. The Company’s scalable offerings include
both on-premises and cloud-based phone systems, telephony services and
industry-leading Voice-Over-IP solutions which, together, provide seamless
connectivity between traditional infrastructure and new technologies. Sangoma's
products and services are used in leading PBX, IVR, contact centre, carrier
networks and data communication applications worldwide.
The biggest growth engine is
Sangoma’s Software as a Service (SaaS) and Cloud-based services, as a
provider of Unified Communications solutions that earns predictable
recurring streams of revenues. Unified Communications (UC) has become the buzz
word for an emerging market in the telecommunications industry, which implies
the integration between modes of communications like text messages, cell phone,
emails, conference calls, instant messaging, screen sharing etc., as well as
being able to switch effortlessly between them to enhance the exchange of
information and ideas for a business operation.
Sangoma Technologies released its Q3 results for fiscal 2017. In Q3, Sangoma
reported that quarterly revenues jumped 29% to C$6.81 million. This was the
ninth quarter in a row that the Company has grown its revenues significantly
and consistently over the same quarter in the prior year. Both EBITDA (10.7% of
revenues) and net earnings are up considerably, too. Earnings per share in the
interestingly in the Q3 report was the Company’s earnings guidance for Fiscal 2017. Sangoma’s Management stated that the previous annual revenue guidance of C$25
million and EBITDA of C$2.4 million will now be exceeded. Fiscal 2017 ends on
the stock's recent performance, the share price still trades at a multiple that is less than one
times revenues based on Management’s financial guidance. Given that the Company
is growing and profitable, Sangoma’s stock price is still notably undervalued.
That said, the stock should begin to attract new investors throughout the
balance of 2017 which could reward its current shareholders with ample share
don’t own Sangoma’s stock yet it may be time to do so.
Technologies maintains a strong balance sheet with a healthy net cash position.
Company has approximately 32.4 million shares outstanding.
Sangoma Technologies website: www.sangoma.com
Ownership Disclosure: TSXV: STC - Yes
This article is for informational purposes only. This article is based on the
author's independent analysis and judgment and does not guarantee the
information's accuracy or completeness. The information contained in this
article is subject to change without notice, and the author assumes no responsibility
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Investorfile.com is not
engaged in an investor relations agreement with Sangoma Technologies
Corporation nor has it received any compensation from Sangoma Technologies
Corporation for the preparation or distribution of this article.
The author of this article has
acquired and may trade shares of Sangoma Technologies Corporation through open
market transactions and for investment purposes only.