Low cost inventory? Check out this Canadian junior, analyst says

Beacon Securities analyst Donangelo Volpe stated Haivision Programs (Haivision Programs Inventory Quote, Chart, Information, Analysts, Financials TSX:HAI) closed fiscal 2025 with a sharply stronger fourth quarter, delivering document income and accelerating profitability, prompting him to lift his goal worth whereas reiterating a “Purchase” ranking.

In a Jan. 15 report, Volpe elevated his goal to $8.00 from $7.00, citing This fall/25 outcomes that exceeded each Beacon and Avenue expectations. Haivision reported document quarterly income of $40-million, forward of Beacon’s $35-million estimate and consensus of $36-million. Income rose 15% quarter over quarter and 33% 12 months over 12 months, pushed by new product introductions and a normalization of U.S. authorities year-end spending. Gross margin was 73%, in step with expectations.

Haivision Programs is a video know-how firm headquartered in Montreal, Quebec, Canada (with a significant workplace in Chicago) that builds mission-critical, real-time video streaming, networking, and collaboration options utilized by enterprises, broadcasters, governments, and different organizations worldwide.

At roughly 1.1x FY26 gross sales and eight.3x FY26 Adjusted EBITDA, Volpe stated Haivision continues to commerce at an unwarranted low cost to friends…

Adjusted EBITDA reached $7-million, versus Beacon’s and consensus estimates of $4-million, representing will increase of 100% quarter over quarter and 140% 12 months over 12 months. Adjusted EBITDA margin expanded to 18%, whereas EPS of $0.11 topped Beacon’s $0.01 forecast and the Avenue’s $0.04.

For FY25, Haivision generated income of $138-million, up 6% 12 months over 12 months, with recurring income accounting for 21%. Adjusted EBITDA totalled $13-million, down from $17-million within the prior 12 months, reflecting early-year transition prices.

Volpe famous that the shift within the management room enterprise towards a pure manufacturing mannequin created short-term headwinds, with the income trough occurring in January 2025, however stated efficiency improved steadily via the again half of the 12 months. Management room gross sales excluding third-party parts rose 35% 12 months over 12 months, whereas third-party element gross sales declined 20%.

Administration guided to greater than $150-million in FY26 income, comparatively flat working bills of about $100-million, and a better than 50% improve in adjusted EBITDA. Beacon’s revised FY26 forecast requires $152.8-million in income and $20.4-million in adjusted EBITDA.

Volpe additionally pointed to steadiness sheet energy and capital flexibility. Haivision ended FY25 with greater than $17-million in money and solely $3-million drawn on its $35-million credit score facility.

“We anticipate that the corporate will proceed to prioritize share repurchases via 2026 given the present valuation,” Volpe stated, noting roughly $5-million in shares repurchased below the NCIB.

At roughly 1.1x FY26 gross sales and eight.3x FY26 Adjusted EBITDA, Volpe stated Haivision continues to commerce at an unwarranted low cost to friends, given expectations for double-digit development, gross margins above 70%, and the potential to exceed 20% Adjusted EBITDA margins with scale.

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