Pivot Technology Solutions (PTG)

[junkHustler]

Seeking Alpha: Pivot Technology Solutions Seems To Be Ripe For Picking
Pivot Technology Solutions Seems To Be Ripe For Picking
Nov. 27, 2015 4:10 PM ET

Summary
Pivot Technology Solutions is an overlooked free cash flow cow with an expected free cash flow yield of 14%.

JP Morgan has offered the company a $200M line of credit, confirming my opinion this company has what it takes to be very successful.

I think the share price could easily increase by 50%, and the company is paying a 5.3% dividend yield while you're waiting.

Introduction
In this article I'd like to make a case for Pivot Technology Solutions (OTC:PVVTF), a Canadian company focusing on providing technical solutions on the communication infrastructure front, cloud computing and virtualization. The company has a lot of Fortune 1000 companies among its customers and thus seems to be enjoying a good brand reputation.

The company's listing in the US has some liquidity but I'd like to refer you to the company's listing in Toronto where Pivot is listed on the Venture Exchange with PTG as its ticker symbol. The average daily volume is approximately 410,000 shares, and the current market capitalization is roughly C$100M.

The numbers are looking good... really good

Pivot Technology Solutions is operating in a high-volume, thin-margin business. The company's revenue in the third quarter of the current financial year was almost $415M, resulting in a gross profit of $40.7M (a gross margin of slightly below 10%). As you undoubtedly notice, this small company is generating a lot of revenue and could have full-year revenue of $1.4B, considering it already reported a total revenue of $1.07B in just the first nine months of the current financial year (up 8.9% compared to the first nine months of 2014).

The bottom line is showing a net loss and this is another reason why I think the company's cash flow statements warrant additional attention. The operating cash flow in the third quarter of this year was a negative $5.3M, but this was entirely caused by a $10.1M impact from the company's working capital position (compensating for WC additions to the operating cash flow in the first half of the financial year).

The adjusted operating cash flow was $4.8M and after deducting the $1.4M in capital expenditures, the company's adjusted free cash flow in the third quarter was $3.4M, or 2 cents per share. Not bad for a company trading at less than 45 cents per share, eh?

Link: http://seekingalpha.com/article/3717266-pivot-technology-solutions-seems-to-be-ripe-for-picking