1 Overlooked Stock Analysts Can’t Stop Talking About

This tech stock is one that analysts have admired for four decades and believe will continue to grow towards $1 billion in revenue by 2024.

| More on:
Double exposure of a businessman and stairs - Business Success Concept

Image source: Getty Images

Headlines continue to be filled by supply-chain disruptions, inflation, interest rates, and the fall of tech stocks. These areas are important. But nothing much has changed over the last few months. And they’re causing many Motley Fool investors to miss out on potentially huge stock opportunities.

What opportunities?

Analysts weighed in recently on one tech stock that Motley Fool investors seem to have overlooked. Calian Group (TSX:CGY) is a business services and solutions company, providing these services to the health, defence, security, aerospace, engineering, AgTech, and information tech industries. Its services expand throughout Canada and the United States as well as Europe.

Calian stock acts like a problem solver, creating agreements, partnerships and acquisitions to make major revenue from some of the world’s biggest names. It can do everything from creating computer and nuclear systems to training services for Canada’s military.

How is it overlooked?

Calian stock recently reported $518 million in revenue for 2021. This was huge for analysts who now believe the company is well on the path towards $1 billion in revenue by 2024. To get there, analysts expect the company to speed up its pace of acquisitions.

Over the past four years under the leadership of Chief Executive Officer Kevin Ford, Calian stock has doubled revenue and cash flow while maintaining an average return on invested capital of 15%.

But the biggest catalyst is the pandemic. With restrictions easing, there are more opportunities for expansion. This is especially true as geopolitical tensions rise, creating a resurgence in military training and cybersecurity aid.

A value stock for even more growth

Calian stock has a 40-year track record of profitability. It’s created value while managing risk. And yet it’s in the tech sector, so Motley Fool investors all but ignore the stock’s growth potential.

Shares of Calian stock trade at about $69 as of writing. Analysts give it a consensus target price $81 as of writing. That’s a potential upside of 17% as of writing. And the proof it can get there is right there. Shares are up 15% in the last year and 156% in the last five years. Yet, since coming on the market, Calian stock rose 891% as of writing! That’s a compound annual growth rate (CAGR) of 9.64% during that time.

Furthermore, given its growth path over the last few decades, the company is one of the few tech stocks to offer a dividend yield. Right now, you can pick up Calian stock with a 1.64% dividend yield, or $1.12 per share per year.

Foolish takeaway

Analysts continue to remain positive about the future of Calian stock. They’re confident in the future path towards $1 billion, marking the company as an outperforming within its industry.

So, even if it takes until 2024 to get there, Calian stock has the momentum behind it that proves the company knows what it’s doing. The transformation into a focused acquisition machine continues to work for the company. And as the world opens up, there will be even more opportunities for this company to expand.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool recommends Calian Group Ltd.

More on Tech Stocks

shopping online, e-commerce
Tech Stocks

Young Investors: Shopify (TSX:SHOP) Stock May Finally Be Worth Buying

Shopify (TSX:SHOP)(NYSE:SHOP) stock is attempting to stage a bottom, but should investors be buyers amid the market chaos?

Read more »

Tech Stocks

How to Easily Turn a $25,000 RRSP Into $250,000

You can hold quality growth stocks such as Shopify in your RRSP and benefit from market-beating gains in the long…

Read more »

Male IT Specialist Holds Laptop and Discusses Work with Female Server Technician. They're Standing in Data Center, Rack Server Cabinet with Cloud Server Icon and Visualization
Tech Stocks

Kinaxis vs. Descartes: Which Is the Better Tech Stock to Buy?

Top tech stocks like Kinaxis Inc. (TSX:KXS) and Descartes Systems Group Inc. (TSX:DSG)(NASDAQ:DSGX) are worth your attention right now.

Read more »

tech and analysis
Tech Stocks

2 Top Tech Stocks Investors Should Consider Buying Right Now

Tech stocks such as Sierra Wireless and Open Text are well positioned to deliver outsized gains to investors in 2022…

Read more »

cup of cappuccino with a sad face
Tech Stocks

Shopify (TSX:SHOP) Stock Has Been a Bloodbath

The share price of the TSX’s tech phenomenon could still plunge if the bloodbath continues due to the slowdown of…

Read more »

sad concerned deep in thought
Tech Stocks

Tech Stocks Crumble: Is it Time to Buy?

Shopify is coming down from its pandemic highs as its business falters, but BlackBerry's business is just gaining steam.

Read more »

young woman celebrating a victory while working with mobile phone in the office
Tech Stocks

This 1 High-Growth Stock Just Got Irresistible

Despite a challenging macro environment, Lightspeed continues to post strong growth, which could help this high-growth stock stage a sharp…

Read more »

exchange-traded funds
Tech Stocks

Buy the Dip: 3 ETFs That Have Taken a Beating in 2022

Three prominent TSX ETFs trades at bargain prices in 2022 because of their significant exposure to the slumping technology sector.

Read more »