Rapid earnings growth can be a good metric for the technology sector
SmallCapPower | August 30, 2016: Profitability is often difficult for smaller technology companies, as it involves keeping costs low and increasing revenues. Thus, those with positive earnings growth over a two-year period, such as the ones on our list today, are firms investors might want to investigate further.
Figures are in millions USD.
Absolute Software Corp. (TSE:ABT) – $7.13
IT Services & Consulting
Absolute Software Corporation is a Canada-based enterprise software-as-a-service (SaaS) provider of endpoint security and data risk management solutions to commercial, education and government customers. The Company operates through Data and Device Security (DDS) segment. Its principal business activities are the development, marketing, and support of endpoint security and data risk management solutions for computing devices, such as desktops, laptops, tablets and smartphones.
- Market Cap: 213.7
- Total Revenue (LTM): 88.8
- Net Income (LFY): 9.7
- Income Growth (2 year CAGR): 65%
Descartes Systems Group Inc. (TSE:DSG) – $27.96
The Descartes Systems Group Inc. (Descartes) is a global provider of on-demand, cloud-based software-as-a-service (SaaS) solutions. The Company is focused on logistics and supply chain management business processes. Customers use its modular, SaaS solutions to route, schedule, track and measure delivery resources; plan, allocate and execute shipments; rate, audit and pay transportation invoices; file customs and security documents for imports and exports; research and perform trade tariff and duty calculations and complete other logistics processes.
- Market Cap: 1,627.0
- Total Revenue (LTM): 189.5
- Net Income (LFY): 20.6
- Income Growth (2 year CAGR): 46%
Tucows Inc. (TSE:TC) – $35.57
Tucows Inc. is engaged in providing Internet services. The Company’s segments include Domain Services and Network Access Services. The Domain Services segment has over three service offerings, being wholesale and retail domain name registration services, value added services and portfolio. The Network Access Services segment includes mobile services and other services. The Network Access Services segment is engaged in the sale of retail mobile phones and services (Ting Mobile) to individuals and small businesses through the Ting Website, as well as other network access services, including high speed Internet access, Internet hosting and network consulting services.
- Market Cap: 285.6
- Total Revenue (LTM): 182.7
- Net Income (LFY): 11.4
- Income Growth (2 year CAGR): 65%
Constellation Software Inc. (TSE:CSU) – $559.86
Constellation Software Inc. is a Canada-based company, which provides enterprise software solutions. The Company acquires, manages and builds vertical market software (VMS) businesses. It operates through two segments: public sector and private sector.
- Market Cap: 9,128.3
- Total Revenue (LTM): 1,987.6
- Net Income (LFY): 177.2
- Income Growth (2 year CAGR): 38%
Sandvine Corp. (TSE:SVC) – $3.54
Communications & Networking
Sandvine Corporation develops and markets Network Policy Control solutions for communications service providers. The Company’s Network Policy Control solutions consists a hardware platform and software modules that are bundled together to provide a system for broadband communications service providers to identify (video streams, such as Netflix, Voice over Internet Protocol traffic, such as Skype, or online gaming), report on and take action on the data traversing their networks.
- Market Cap: 376.7
- Total Revenue (LTM): 130.0
- Net Income (LFY): 41.3
- Income Growth (2 year CAGR): 79%