Would be interested to hear why you think EVS is a high growth tech stock. At 21c we have a market cap value just over 5x price to arr sales. If the market cap moves towards $300m from here (25c and just over 6x psr) then I think that will be around fair value on current results.
But EVS has a number of other factors going for it. One of these is its ESG credentials. ESG compliant companies will have an edge in the coming years as investors/funds will start to allocate part of their portfolios to only ESG compliant ones. One step better is that EVS operates in the aviation, mining and industrial, waste and water sectors. These are the sectors that will need to see the greatest transition towards more responsible ESG policies and therefore the market potential for EVS to claim is very large.
While the market may see a rotation away from overvalued tech companies trading at much higher PE or PSR multiples, EVS could be protected somewhat from these factors. Their churn is low and they have a large number of blue chip companies that will likely continue to use EVS services even if there are macro economic factors that challenge financials.
With good execution EVS is well placed to become a leader in the environmental intelligence space and I think this will command a higher valuation.
EVS Price at posting:
21.0¢ Sentiment: Hold Disclosure: Held
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