Information Services Corporation (TSX:ISV) possesses “high free cash flow with growth attached,” according to one analyst
Capital Ideas Media | January 5, 2021 | SmallCapPower: Investors looking for a decent dividend-paying stock with growth potential might want to consider shares of Information Services Corporation (TSX:ISV), currently yielding 4.3% (now 3.6%).
(Originally published on Capital Ideas Media on November 3, 2020)
Information Services Corp. (ISC) is provider of registry and information management services for public data and records, offering services such land registry, land surveys, personal property registry, and corporate registry.
[Editor’s Note: Shares of Information Services Corp have gained more than 17% since Capital Ideas wrote about the company about two months ago.]
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Raymond James analyst Stephen Boland thinks ISC possesses “high free cash flow with growth attached.”
“Since going public in 2013, the company has expanded beyond the core Saskatchewan registry businesses,” the analyst said.
“It has made a number of acquisitions to expand its geographic footprint, as well as the types of information management services it offers. Recently, ISC completed a $70-million acquisition of the assets of Paragon Inc. to form its Recovery Services Division, which will complement the credit lifecycle vertical. Paragon is essentially a project manager in the vehicle repossession industry for the large Canadian banks. It earns administration fees and contingency fees if successful in recovering the asset.”
Mr. Boland stated that since 2014, ISC’s dependence from the registries line of business has declined from 100% of the revenue to 53% in 2019 and he estimates with the Company’s latest acquisition registries revenue will fall below 50% of its total revenue. He emphasized that ISC has “demonstrated consistent growth over the past six years.
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