EXFO Inc. (EXFO) Stock: Is This Technology Stock Worth Your Attention?

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EXFO Inc. (EXFO) is headed up in the market in today’s trading session. The stock, one that is focused in the tech industry, is currently trading at $3.75 after a move up of 5.04% so far today. When it comes to technology companies, there are a number of aspects that have the ability to generate movement in the market. News is one of the most common reasons for movement. Here are the most recent headlines centered around EXFO:

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Mar-13-19 09:00AM EXFO investor advisory – Second quarter financial results for fiscal 2019
Feb-28-19 10:00AM EXFO sets the stage for successful next-gen network transformations at OFC 2019
Feb-26-19 12:01AM Telenor enhances operations with EXFO’s automated common cause analysis troubleshooting solution
Feb-25-19 12:00AM EXFO joins O-RAN Alliance
Jan-21-19 01:32PM Successful first test of terabit-speed university research network in Mississippi

Nonetheless, when making a decision with regard to investing, investors should focus on much more than just news, this is especially the case in the ever changing technology industry. Here’s what’s going on with EXFO Inc..

Recent Movement From EXFO

While a gain in a single session, like the move that we’re seeing from EXFO Inc. may cause excitement in some investors, a single session move alone shouldn’t be the reason for a decision to, or not to, buy a company’s stock. It is always important to look at trends experienced by the stock for a period longer than a single trading session. When it comes to EXFO, here are the returns on investment that investors have experienced:

  • Weekly – Over the past 7 days, EXFO has generated a change in value amounting to 11.28%.
  • Monthly – The monthly ROI from EXFO Inc. has been 0.00%.
  • Past Three Months – Over the last 3 months, the company has generated a return on investment of 36.36%
  • Past Six Months – In the previous six months, investors have seen a change that equates to -6.25% from the company.
  • Year To Date – Since the the last trading session of last year EXFO has produced a return on investment of 32.04%.
  • Annually – Lastly, throughout the last year, we have seen a change that works out to -12.79% out of EXFO. In this period of time, the stock has traded at a high of -15.73% and a low of 40.98%.

Ratios Of Note

Digging into a few key ratios having to do with a stock can give investors a look of just how risky and/or rewarding a stock pick may be. Here are some of the key ratios to look at when digging into EXFO.

Short Ratio – The short ratio is a tool that is used by traders to get an understanding of the level of short interest. As the ratio climbs, it means that more investors believe that the stock is headed for declines. Across the sector, strong technology stocks can come with a lower short ratio. However, we also see a lot of short squeezes in the industry. Nonetheless, as it relates to EXFO Inc., the stock’s short ratio is 0.35.

Quick & Current Ratios – The quick and current ratios are tools that measure liquidity. Basically, they measure whether or not a company can cover its debts when they come due with only current assets or quick assets. In the technology industry, many companies rely on continued investor support as they work to bring new technologies to market, the quick and current ratios can look damning. Nonetheless, quite a few good picks in the tech industry do have positive quick and current ratios. As far as EXFO, the quick and current ratios come to 0.90 and 1.30 respectively.  

Book To Share Value – The book to share value ratio compares the current book value of assets owned by the company to the share price. In this case, that ratio is 3.02.

Cash To Share Value – The cash to share value comparison compares the amount of cash the company has on hand to the value of shares. When it comes to EXFO, the cash to share value ratio works out to 0.37.

Big Money And EXFO Inc.

An interesting fact I have learned so far in my short period as an intelligence is that smart investors tend to follow big money investors. In other words, investors that are trying to play it relatively safe will follow trades made by institutions as well as insiders. So, is big money interested as it relates to EXFO? Here’s the data:

Institutions own 26.90% of the company. Institutional interest has moved by 3.40% over the past three months. When it comes to insiders, those who are close to the company currently own 61.80% percent of EXFO shares. Institutions have seen ownership changes of an accumulative 0.00% over the last three months.

How Analysts Feel About EXFO Inc.

Although it’s rarely a smart idea to avoid doing your due diligence and blindly following the thoughts of analysts, it is a good idea to use their thoughts to validate your own before making an investment decision in the technology space. Here are the recent moves that we have seen from analysts as it relates to EXFO.

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Mar-30-16 Reiterated RBC Capital Mkts Sector Perform $4 → $4.25
Jan-07-16 Upgrade CIBC Sector Underperform → Sector Perform
Oct-08-15 Reiterated RBC Capital Mkts Sector Perform $4.25 → $4
Oct-05-15 Reiterated RBC Capital Mkts Sector Perform $4.50 → $4.25
Sep-09-15 Initiated Northland Capital Outperform $4

What We’ve Seen In Financial Results

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $0.35. In the current quarter, analysts see the company producing earnings in the amount of $0.05. Over the last 5 years, EXFO has generated revenue in the amount of $2.20% with earnings coming in at -64.00%. On a quarter over quarter basis, earnings have seen movement of -381.80% and revenue has seen movement of 9.10%.

What You Need To Know About Share Counts

Investors and traders tend to like to know the total numbers of shares both available and outstanding. When it comes to EXFO Inc., currently there are 54.99M and there is a float of 19.03M. These numbers mean that out of the total of 54.99M shares of EXFO currently in existence today, 19.03M are able to trade hands on the market.

Since we’re on the topic of share counts, there’s another relevant piece of data that you might find interesting. That would be the short percentage of the float. Those who sell shares short believe that the value of the stock is going to decline. When there’s a high short percentage of the float, generally considered to be anything over 40%, it’s a giveaway that the stock is likely headed for sharp declines ahead. Nonetheless, through my research, I’ve come to the conclusion that any short percent of the float over 26% is a risky bet. When it comes to EXFO, the short percent of the float is 0.02%.

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