Q: Please comment on CPH latest earnings. It looks like a bit of a mixed bag. The stock is expensive, but they are throwing off a lot of FCF and their strategy looks solid going forward. Thank you.
5i Research Answer:
EPS of 10c missed estimates of 10.6c; revenue of $12M matched estimates. EBITDA of $6.2M beat estimates by 8%. Revenue rose 105%. Cash flow was solid, and the company announced a 10% buyback and a $15M debt paydown. Margins did slip 6 points, however. About 15% EPS growth is expected over the next year. We are comfortable with the numbers and the 15X earnings valuation. With a small revenue base we would not expect 100%+ growth going forward, however.