Q: Your last assessment of the stock at the higher price was: it is getting interesting.
Would you step in today before the Q results? Perhaps we are hitting the bottom here?
Would you step in today before the Q results? Perhaps we are hitting the bottom here?
5i Research Answer:
With negative momentum, it is tough to step in before a quarterly release. DNTL is also quite leveraged, adding risks if fundamentals shift. Still, cash flow is decent and growth looks good. It is in the early days of its acquisition plans, and it might also be a privatization candidate (like NBLY recently). The last quarter was fine, with good growth. But...the stock is hardly cheap on valuation (36X earnings), and with its small size, with embedded losses, and going into year end, we think one can wait still here before buying.