Looking for a profitable fast-growing stock? Look at Photon Control Inc
07.04.2016 • About Photon Control Inc (
$PHO) • By InTwits
Have you thought about Photon Control Inc as a growth stock? Its revenue performance, profitability and healthy financial model stands it out vs. other public companies on the market.
Growth story
Photon Control Inc showed growth in the last financial year. The company's revenue surged on 31.1% in FY2015. Together with revenue growth Photon Control Inc also managed to keep EBITDA growth. EBITDA grew 71.2% for the same period.
In the longer period Photon Control Inc showed fast revenue growth of 38.0% from 2012 to 2015 annually. EBITDA surged on 78.7% from 2012 to 2015 annually.
Photon Control Inc ($PHO) financials for the last 5 years
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 |
|---|
| Revenue | 11 | 11 | 17 | 21 | 28 |
|---|
| Revenue growth, % | | -8.6% | 64.3% | 21.9% | 31.1% |
|---|
| Gross margin, % | 38.6% | 37.1% | 42.3% | 48.2% | 52.9% |
|---|
| SG&A, % | | 17.4% | 13.1% | | 9.97% |
|---|
| EBITDA | 1 | 2 | 4 | 6 | 11 |
|---|
| EBITDA growth, % | | 98.6% | 130.6% | 44.4% | 71.2% |
|---|
| EBITDA margin, % | 8.12% | 17.6% | 24.8% | 29.3% | 38.3% |
|---|
| Net Income | 5 | 3 | 3 | 5 | 9 |
|---|
| Net Income margin, % | 40.5% | 28.9% | 20.2% | 24.0% | 33.4% |
|---|
| |
| CAPEX | 0 | 0 | 0 | 0 | 0 |
|---|
| CAPEX/Revenue, % | 0.728% | 0.185% | 0.237% | 0.425% | 1.07% |
|---|
| Debt | 0 | 0 | 0 | 0 | 0 |
|---|
| Cash | 1 | 4 | 6 | 14 | 26 |
|---|
| Net Debt/EBITDA | -1.0x | -1.9x | -1.4x | -2.3x | -2.5x |
|---|
| |
| ROIC, % | 10.1% | 21.0% | 44.4% | 38.0% | 40.6% |
|---|
| ROE, % | 67.9% | 28.2% | 24.7% | 26.8% | 34.5% |
|---|
Profitability and return on investment
EBITDA growth was supported by margin expansion. Photon Control Inc's EBITDA margin surged on 9 pp from 29.3% to 38.3% in 2015. In the last 3 years Photon Control Inc's EBITDA margin surged on 20.7 pp from 17.6% in 2012 to 38.3% in 2015.
We call Photon Control Inc an attractive growth stock as together with the growth it delivers high ROIC at 40.6%. Three years ago it was considerably lower at 21.0%. It's average level of ROIC for the last three years was 41.0%.
Net Income margin surged on 9.40 pp from 24% to 33.4% in 2015. If we look for the longer period Net Income margin surged on 4.50 pp from 28.9% in 2012 to 33.4% in 2015.
Photon Control Inc operates at ROE of 34.5%. For the last three years the average ROE was 28.7%.
Capital expenditures (CAPEX)
The company's CAPEX/Revenue was 1.07% in FY2015. CAPEX/Revenue surged on 0.885 pp from 0.185% in 2012 to 1.07% in 2015. It's average level of CAPEX/Revenue for the last three years was 0.577%.
Leverage (Debt)
Photon Control Inc has negative net debt at -2.5x Net Debt/EBITDA - at the same time with high growth. If we look for the longer period Photon Control Inc showed fast leverage growth of 0.54x from -1.95x in 2012 to -2.48x in 2015.
Valuation vs. comparable companies
At the end of trading day today Photon Control Inc traded at 5.0x EV/EBITDA which is 82.4% lower than 28.4x Industrial peer group avearge calculated on the basis of 168 companies. At the end of trading day today Photon Control Inc traded at 8.6x P/E which is 60.5% lower than 21.7x Industrial peer group avearge calculated on the basis of 40 companies.
Peers in Industrial
Below you can find Photon Control Inc benchmarking vs. other companies in Industrial industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Diversified Royalty Corp ($DIV) | | | | | 503.3% |
| Electrovaya Inc ($EFL) | | -4.0% | -71.2% | 160.5% | 123.8% |
| WSP Global Inc ($WSP) | | 92.9% | 60.3% | 44.0% | 108.9% |
| CEMATRIX Corp ($CVX) | | 9.2% | -5.6% | 7.9% | 76.5% |
| Lumenpulse Inc ($LMP) | | 56.7% | 33.9% | 47.0% | 61.8% |
| |
|---|
| Median (78 companies) | 0.7% | 11.5% | 4.9% | 9.1% | 10.0% |
|---|
| Photon Control Inc ($PHO) | | -8.6% | 64.3% | 21.9% | 31.1% |
Top companies by Gross margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Pure Technologies Ltd ($PUR) | 75.7% | 77.9% | 78.0% | 77.5% | 75.6% |
| WSP Global Inc ($WSP) | 81.1% | 81.1% | 83.2% | 81.0% | 74.0% |
| Alarmforce Industries Inc ($AF) | 76.4% | 75.0% | 76.5% | 72.2% | 69.2% |
| Epicore BioNetworks Inc ($EBN) | 59.0% | 60.8% | 63.2% | 64.1% | 58.1% |
| Avigilon Corp ($AVO) | 45.7% | 49.3% | 54.2% | 56.6% | 57.4% |
| |
|---|
| Median (72 companies) | 23.2% | 23.0% | 23.3% | 22.6% | 24.0% |
|---|
| Photon Control Inc ($PHO) | 38.6% | 37.1% | 42.3% | 48.2% | 52.9% |
Top companies by EBITDA margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Canadian National Railway Co ($CNR) | 46.3% | 46.5% | 45.9% | 46.8% | 50.9% |
| Canadian Pacific Railway Ltd ($CP) | 28.1% | 26.1% | 32.4% | 43.7% | 48.9% |
| Vitreous Glass Inc ($VCI) | 29.0% | 31.4% | 32.2% | 37.8% | 39.0% |
| Evertz Technologies Ltd ($ET) | 37.2% | 29.6% | 29.1% | 23.0% | 27.0% |
| Badger Daylighting Ltd ($BAD) | 27.2% | 25.7% | 25.9% | 27.9% | 24.6% |
| |
|---|
| Median (73 companies) | 8.3% | 9.2% | 8.3% | 7.2% | 9.5% |
|---|
| Photon Control Inc ($PHO) | 8.1% | 17.6% | 24.8% | 29.3% | 38.3% |
Top companies by CAPEX/Revenue, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Newalta Corp ($NAL) | 17.2% | 21.7% | 34.5% | 35.1% | 42.0% |
| Cargojet Inc ($CJT.A) | 6.8% | 7.0% | 6.3% | 54.1% | 41.3% |
| Algoma Central Corp ($ALC) | 6.6% | 15.9% | 7.3% | 5.0% | 27.4% |
| Canadian Pacific Railway Ltd ($CP) | 21.3% | 20.2% | 20.2% | 21.9% | 22.7% |
| Canadian National Railway Co ($CNR) | 18.0% | 17.4% | 18.7% | 18.9% | 21.5% |
| |
|---|
| Median (77 companies) | 3.0% | 3.1% | 3.7% | 3.2% | 3.9% |
|---|
| Photon Control Inc ($PHO) | 0.7% | 0.2% | 0.2% | 0.4% | 1.1% |
Top companies by ROIC, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Vitreous Glass Inc ($VCI) | 26.1% | 30.5% | 32.3% | 48.3% | 51.0% |
| Pacific Safety Products Inc ($PSP) | -19.0% | -1.5% | -11.5% | 3.7% | 38.2% |
| CEMATRIX Corp ($CVX) | 15.7% | 6.4% | -2.4% | -6.7% | 30.4% |
| IWG Technologies Inc ($IWG) | 13.4% | 17.0% | 36.3% | 23.4% | 27.2% |
| Epicore BioNetworks Inc ($EBN) | 24.8% | 28.1% | 16.1% | 32.5% | 26.3% |
| |
|---|
| Median (78 companies) | 8.9% | 9.3% | 8.5% | 8.5% | 10.0% |
|---|
| Photon Control Inc ($PHO) | 10.1% | 21.0% | 44.4% | 38.0% | 40.6% |
Top companies by Net Debt / EBITDA
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Conifex Timber Inc ($CFF) | | | 2.7x | 6.1x | 35.9x |
| Ag Growth International Inc ($AFN) | 2.4x | 2.9x | -0.1x | 2.1x | 14.1x |
| Cargojet Inc ($CJT.A) | 1.8x | 1.5x | 1.5x | 31.5x | 12.9x |
| Progressive Waste Solutions Ltd ($BIN) | 2.5x | 4.5x | 3.3x | 2.9x | 10.6x |
| Finning International Inc ($FTT) | 1.8x | 2.3x | 1.8x | 1.4x | 9.4x |
| |
|---|
| Median (66 companies) | 1.1x | 1.5x | 1.5x | 1.3x | 1.2x |
|---|
| Photon Control Inc ($PHO) | -1.0x | -1.9x | -1.4x | -2.3x | -2.5x |
