Up 64% from last year, Sangoma
Technologies (TSXV: STC) is a top pick again for 2019. Other stock predictions
to perform next year include Novra Technologies (TSXV: NVI) and Destiny Media
Technologies (TSXV: DSY).
This is the eighth year that we continue with our
annual tradition each December: When the Investorfile blog becomes a
predictor of a few investment themes for our current list of Top Ideas that may
have a very positive impact as a percentage gainer on the stock price for the
upcoming year. Therefore, they become our top picks. While our
track record for our annual top picks is not always perfect, our record shows
we tend to be more right than wrong in generating investment gains over the following
twelve months. That said, this list does not eliminate the potential for our
remaining Top Ideas to become top performing stocks as well in 2019.
Of note: Sangoma Technologies returns as
an Investorfile top pick for the second straight year.
Investorfile predictions for 2019:
1. Our Top Ideas stock that will see its
trading multiple expand based on key financial metrics.
Sangoma Technologies Inc. (TSXV: STC- C$1.23)
Sangoma 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.
The Company is experiencing significant growth, both
organic and through acquisitions. Management has provided financial guidance
for fiscal 2019: Revenues at C$100 million and EBITDA at C$10 million. As a
bigger company, we feel the stock could trade higher in value in 2019 to
reflect a trading multiple more in line (eg. price to sales) with its peer
group of other publicly traded technology companies. Currently, four analysts
provide research coverage on Sangoma Technologies with 12-month price targets
ranging from C$2.25 to C$2.50 which implies as much as 103% upside from the
current stock price level.
Last blog post:
We repeat: Sangoma Technologies is still a strong buy today
2. Our Top Ideas stock that could show
significant revenue and profit growth in 2019 as a result of completing the
integration of a prior year acquisition.
Novra Technologies Inc. (TSXV: NVI- C$0.155)
Technologies (the parent company of the Novra Group) is an international
technology provider of products, systems and services for the distribution of
broadband multimedia content via satellite and hybrid networks. Novra applications' focus includes broadcast video and radio, digital cinema,
digital signage and highly reliable data communications.
The Company’s most
recent acquisition of a controlling interest in Wegener Corporation makes them
a bigger company with a stronger product portfolio and greater operating
leverage. The financial benefits of the Wegener acquisition are starting to
show promise based on Novra Technologies' most recent quarterly results. By
next year, the integration of Wegener will be complete and the Company could
see significant revenue and profit growth which could have positive impact on
the stock price in the coming year.
Novra Technologies is a strong buy given its recent financial results and
3. Our Top Ideas stock which made R&D investments
to upgrade its technology, thus leading to expanding sales and more
Destiny Media Technologies Inc. (TSXV: DSY- C$0.33)
Media Technologies is the provider of Play MPE, a cloud-based enterprise
Software-as-a-Service (SaaS) used by the recording industry for promoting and
distributing broadcast-quality audio, video, images, promotional information
and other digital content securely through the internet.
year, the Company has decided to reinvest in its Play MPE technology. It began
with the re-engineering to a cloud-based architecture, which laid the
groundwork to improve the software’s reliability and performance. This allowed
for the rollout of a major upgrade: the release of Play MPE Version in middle
of 2018. The new version of the technology has already been embraced by the
Company’s largest customer, Universal Music, which renewed
its Online Content Distribution Services Agreement with Destiny Media
Technologies Inc., including a 14% increase in monthly fees to accommodate its
expanded use of the Play MPE(R) system. The Universal agreement and other
companies expected to be sign should have a meaningful impact on revenues
and profits next year, as well as a potential positive impact on the Company’s
stock price moving forward.
Last blog post:
Destiny Media Technologies is a value buy that is growing and already
A recap of Investofile’s predictions for
1. Our Top Ideas stock that should get
discovered by institutional investors in 2018.
Prediction was: Sangoma Technologies
Inc. (TSXV: STC)
Then: C$0.75 Now: C$1.23 Current return:
In 2018, Sangoma Technologies was discovered by
institutional investors and research analysts and, subsequently, the stock's
trading volumes and price have risen sharply. The Company also closed a C$13
million equity financing during the year, which was heavily subscribed to by
2. Our Top Ideas stock which could see a
significant turnaround in revenues and profits.
Prediction was: Posera Ltd. (TSX: PAY)
Then: C$0.195 Now: C$0.10 Current return:
Posera’s products and services facilitate
all aspects of the payment transaction between the merchant and the consumer in
the hospitality industry.The Company’s Point-of-Sale (POS) Systems
software solutions, associated enterprise management tools and debit/credit
payment terminals have been deployed in 25 countries in over 30,000 merchant locations
To date in 2018 revenue growth is flat and
profits have not yet emerged. Our predication of revenue and profit growth was
based a widespread deployment of the Company’s SecureTablePay payment solution
in the US
market in 2018. The deployment of SecureTablePay in the USA is now just beginning and
should gain traction in 2019.
3. Our Top Ideas stock which could see
revenue growth from bigger contracts in 2018.
Prediction was: Intrinsyc
Technologies (TSX: ITC)
Then: C$1.27 Now: C$1.39 Current return:
Intrinsyc Technologies derives sales
from proprietary computer modules and development kits, as well as high-margin
engineering services related to those modules and kits for an OEM product
We predicted for 2018 that the Company’s revenue
growth would benefit from large contract wins. It did, and revenues have jumped
34% in the first nine months of 2018 to US$18.6 million. While the stock is up somewhat
in price from a year ago, the current value still does not reflect the business
success Intrinsyc has generated this year.
Author’s ownership disclosure: Yes - ITC,
STC, PAY, DSY, NVI
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 to update the information contained in this article. The
information contained within this article should not be construed as offering
of investment advice. Those seeking direct investment advice, should consult a
qualified, registered, investment professional. This is not a direct or implied
solicitation to buy or sell securities. Readers are advised to conduct their
own due diligence prior to considering buying or selling any stock.
Investorfile.com is not engaged in an investor relations
agreement with Intrinsyc Technologies Corp. Sangoma Technologies Corp., Posera
Ltd., Novra Technologies Inc. and Destiny Media Technologies Inc. nor has it received
any compensation from Intrinsyc Technologies Corp. Sangoma Technologies Corp.,
Posera Ltd., Novra Technologies Inc. and Destiny Media Technologies Inc. for
the preparation or distribution of this article.
The author of this article has acquired and may trade shares of Intrinsyc
Technologies Corp., Sangoma Technologies Corp., Posera Ltd., Novra Technologies
Inc. and Destiny Media Technologies Inc. through open market transactions and
for investment purposes only.