Absolute Software (ABT) Gets a Hold Rating from Canaccord Genuity

By Ryan Adsit

Wall Street analyst has provided a rating update for the Technology company yesterday, while remaining neutral on the stock. Analyst Doug Taylor from Canaccord Genuity reiterated a Hold rating on Absolute Software (TSX: ABT), with a C$8 price target.

Taylor wrote:

“Absolute Software reported its June Q4 that was generally ahead of expectations. Fresh annual guidance for the upcoming June fiscal year reflects slower-than-anticipated revenue growth, but higher margins, which we see as an encouraging sign given strong operating leverage on expected growth. All in all, our EBITDA estimate for the year rises as a result of the expectations and, along with it, our EBITDA-based target goes to C$8.00 (from C$7.50). With that said, we continue to look for sustained higher revenue growth before we are willing to assign Absolute Software a higher multiple than the 15x NTM EBITDA it currently trades at. Until higher growth materializes, or a more attractive entry point appears, we maintain a HOLD rating.”

Taylor has an average return of 12.1% when recommending Absolute Software.

According to TipRanks.com, Taylor is ranked #1319 out of 4847 analysts.

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The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Absolute Software with a C$9.13 average price target.

Based on Absolute Software’s latest earnings release for the quarter ending March 31, the company reported a quarterly net profit of C$1.33 million. In comparison, last year the company had a GAAP net loss of C$2.81 million.

Absolute Software Corp. engages in the provision of endpoint security and data risk management solutions to commercial, healthcare, education, and government customers. The firm operates through the following geographical segments: United States, Rest of the World, and Canada.

The company’s shares closed on Monday at C$7.73.