In our last Number Cruncher we discussed how Hardwoods Distribution Inc. (HDI), A&W Revenue Royalties Income Fund (AW.UN) and Absolute Software Corporation (ABST) are small caps with tailwinds and a track record of long-term profitability.
Here is the screener we used to find these stocks and that you can add to your personalized screeners.
Starting off with HDI
In the past 90 days, HDI’s SP score has increased by 1, bringing it up to 65. The SP score is derived from the Performance (86.6) and Risk (42.0) scores. The company has an impressive bias to Value and Growth, with scores of 75 and 74 respectively. HDI experienced an incredible year, seeing a 1-year growth of 109.9% in annual sales. Moreover, the company’s return on capital (ROC) increased to 22.4% over the past year, from the 5-year average of 14.0%.
Up until midway through 2021, our system evaluated the company to be fairly priced. Since then, however, there has been a sharp divergence between our intrinsic valuation and the actual share price. Currently, our model indicates that HDI is intrinsically valued at $438.31. Interestingly, we can see that as the intrinsic value rose the share price slightly declined. This is likely due to the market expecting the reversal in the profitability of the company.
Continuing with AW.UN
AW.UN currently has a respectable SP score of 63, having increased by 3 over the past 90 days. The SP score is determined by their fair Performance (59.4) score and attractive Risk (22.3) score. AW.UN has quality and volatility bias with scores of 77 and 74 respectively.
As seen above, AW.UN completely surpasses its peers when it comes to risk, while also beating all but one in terms of performance. Such a low risk score reflects the stability of the company’s revenue which is attractive to its shareholders.
Lastly, let’s look at ABST
Absolute Software’s current SP score is 65, an increase of 5 over the past 90 days. The company’s SP score is determined through their Performance (78.9) and Risk (38.5) scores. The company has a strong factor tilt towards growth with an impressive score of 84, and towards momentum with a score of 73. ABST saw an increase in annual sales of 61.2% from last year, a positive divergence from their 5-year average of 22.2%.
When it comes to the company’s factor exposure, can see that ABST outshines its peers in terms of growth, momentum, yield, and overall ranking.
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Amenard@Inovestor.com
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