Tucows released it's fourth quarter results on February7 and it had another good quarter.Revenues were up 9% but net income and earnings per share were down 9 and 7% respectively.E.P.S was only $.27 compared to $.29 for the same quarter last year.But their yearly results were well above average.Annual revenues were up 11% to $190 million while net income was up almost 50% to $16 million and annual earnings per share went from $1.04 to $1.53.This compares to their competitors who all have negative earnings except for Intrinsyc Software (a smaller competitor).
There is always room for Improvement
As mentioned before Tucows is in a competitive business.It provides domaine names,mobile network access and other internet services.Kinaxis is largely in cloud computing while Shopify is in e-commerce software.This blog recommends that TC will have to expand into one of these other areas soon.In order to do so it will likely have to do another small equity issue (perhaps 2 to3 million shares) and make a few small acquisitions.
On the other hand,Tucows is increasing it's revenues by at least 10% every quarter.Also e.p.s was up almost 50% on an annual basis in 2016.With a few new acquisitions this blog sees annual e.p.s at $1.70 to $1.80 per share.With a new equity issue of 3 million shares earnings would be diluted by 25 to 30% and still be around $1.10 to $1.20 per share;this compares to negative earnings for Kinaxis and Shopify.The new funds would allow them to enter the less profitable cloud computing area but also give them more stability. use Workathon for business consulting ;use Workathon for business solutions
