KeyStone Financial Independent Equity Advisors

Transcription

1 KeyStone Financial Independent Equity Advisors

2 Quick Market Review The TSX posted strong gains from 2013 until the first quarter of 2015 in a rally that lasted 30-months. It got expensive. The average investor often gets it wrong. Potential Opportunities: Upcoming tax loss season. Stocks that benefit from U.S. Dollar strength (costs in $CDN, sell in $US). Battered energy stocks?

3 Espial Group Inc. (ESP:TSX) Price: $2.34 (Original BUY, December 2014: $1.60) Sector: Technology - Software - supplier of digital TV and IPTV software and solutions to cable MSOs and telecommunications operators as well as consumer electronics manufacturers. Investment Highlights: Excellent Balance Sheet, Profitable Business Model, Approaching Potential Strong Growth Phase and Relatively Low Valuations. Q Highlights Revenue rose 72% to $8.71 million from $5.06 million in Q Earnings jumped to $2.2 million or $0.06 per share from $213,970, or $0.01 per share, in Q

4 Espial Group Inc. (ESP:TSX) Valuations/Fundamentals 2015 Earnings Estimate: $0.15 P/E is Cash $47.5 million or $1.30 per share (zero debt); Cash Out 2015 PE: 6.8 Espial currently has a pipeline of approximately 60 potential cable/telco customers in North America and Europe with 1 million subscriber or greater. The company is engaged with 25 and has a deeper engagement with 6.

5 ESP:TSX Chart

6 Firan Technology Group (FTG:TSX) Price: $2.15 (Original BUY, May 2015: $1.35) Sector: Industry: Technology Manufacturing (Aerospace/Defense) - supplier of aerospace and defence electronic products and subsystems. Investment Highlights: Solid Balance Sheet, Profitable, Benefitting from Low Loon & Strong $US, and Relatively Low Valuations. Q Highlights Revenue increased 23% to $18.23 million from $14.8 million in Q Earnings jumped to $1.64 million, or $0.09 per share from $219,000, or $0.01 per share, in the same quarter of 2014.

7 Firan Technology Group (FTG:TSX) Valuations/Fundamentals Trailing Earnings: $0.21 P/E is Earnings Estimate: $ P/E is 7.6. Growth Approximately 72% of costs are in Canadian dollars, majority of sales in $US. Looking forward into Q4 2015, the company has a solid order book and we expect material growth over the numbers produced in Q which should produce a record 2015.

8 FTG:TSX Chart

9 High Arctic Energy Services Inc. (HWO:TSX) Price: $4.04 (Original BUY, JULY 2013: $2.21) Sector: Oilfield equipment and services for drilling, completion and work over operations - Based in Red Deer, Alberta, High Arctic has operations throughout Western Canada and in Papua New Guinea. Investment Highlights: Great Balance Sheet (Strong Cash Position), Attractive Dividend (4.9%), Recent Equipment Expansion Purchase (2-year contract), and Attractive Valuations (low PE, high ROE, high ROI). Q Financial Results Revenues increased 22% $48.7 million from $39.8 million in Q Adjusted EBITDA rose 33% to $14.1 million of $0.26 per share from to $11.1 million or $0.20 per share in Q

10 High Arctic Energy Services Inc. (HWO:TSX) Valuations/Fundamentals 2015e EBITDA Shr: $0.95 EV/EBITDA is e Earnings Per Shr: $ EV/EBITDA is 2.9. ROE: 25%, ROI: 23%. Annual dividend yield is in the range of 4.9% (raised this year) - payout ratio very conservative at 22%. Growth Recent Contract/ Equipment Purchase April 9, Signs a 2 year ($60 million) drilling services contract with InterOil and purchases two drilling rigs. Just started contributing to earnings. Recent Guidance: Management expects the third quarter 2015 adjusted EBITDA to exceed $18 million all time record.

11 HWO:TSX Chart

12 Lingo Media Corporation (LM:TSX) Price: $0.60 (Original BUY, OCT: $0.46) Sector: EdTech company, through its two distinct business units, the company develops, markets and supports a suite of English language learning solutions consisting of web-based software licensing subscriptions, online and professional services, audio practice tools and multi-platform applications. Q Financial Results Revenue jumped 104% to $1.79 million from $877,879 in the same period of Net profit for the quarter was $979,103 or $0.04 earnings per share basic compared to $217,633 or $0.01 per share for the same period in 2014.

13 Lingo Media Corporation (LM:TSX) Valuations/Fundamentals 2015e Earnings Per Shr: $0.08 P/E is e Earnings Per Shr: $ P/E is 6.

14 LM:TSX-V Chart

15 Thank-you ladies and gentlemen.