The Canadian software stocks on our list have posted the highest Returns on Equity (ROE) along with EBITDA margins
SmallCapPower | November 9, 2017: Today, we look at some technology stocks that provide investors with some of the highest EBITDA margins in the industry. The Canadian software stocks listed provide unique cloud-based software using data analytics to clients across the world.
Computer Modelling Group Ltd. (TSX:CMG) – $10.22
Software
Computer Modelling Group Ltd. (CMG) is a Canada-based computer software company serving the oil and gas industry. The Company develops and licenses a reservoir simulation software for international oil companies and technology centers in approximately 60 countries. The Company also provides professional services that comprise, consulting, training and contract research activities. CMG has offices in Calgary, Houston, London, Dubai, Bogota and Kuala Lumpur.
- Market Cap: $821 Million
- Return on Equity (LFY): 41.1%
- EBITDA Margin (LFY): 45.8%
Kinaxis Inc. (TSX:KXS) – $71.60
Software
Kinaxis provides cloud-based subscription software for supply chain management. The Company’s RapidResponse offers a collection of cloud based applications using data analytics for a variety of supply chain solutions, including inventory management, order fulfillment and capacity planning. The Company’s customers include companies in various industries, including technology and electronics; aerospace and defense; life sciences and pharmaceuticals; industrials, and automotives.
- Market Cap: $1,822 Million
- Return on Equity (LFY): 24.6%
- EBITDA Margin (LFY): 17.6%
Enghouse Systems Ltd. (TSX:ENGH) – $54.75
Software
Founded in 1984, Enghouse Systems Limited develops enterprise software solutions for a variety of industry sectors. The Company operates through three segments: Enghouse Interactive, Enghouse Networks and Enghouse Transportation. The Interactive segment offers communications software and services primarily for client customer service operations. The Networks segment offers solutions for planning, design, operations, and support of telecommunications and utility networks. Lastly, the transportation segment offers solutions such as route scheduling, driver time keeping and uses data analytics for a variety of real time applications.
- Market Cap: $1,484 Million
- Return on Equity (LFY): 18.5%
- EBITDA Margin (LFY): 28.2%
Mediagrif Interactive Technologies Inc. (TSX:MDF) – $12.95
Internet Software & Services
Mediagrif Interactive Technologies is a Canada-based company that provides eCommerce solutions to businesses and consumers. The Company owns several web-based platforms including Joboom and Intertrade. Mediagrif employs 440 individuals and has offices in Canada, the United States and China.
- Market Cap: $193 Million
- Return on Equity (LFY): 12.0%
- EBITDA Margin (LFY): 36.9%
Disclosure: Neither the author nor any of the principals at SmallCapPower, or their family members, own units in any of the companies mentioned above.
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