WeCommerce: Canaccord Lowers Price Target Following Marketing Meetings

Over the last few weeks, Canaccord hosted a number of marketing meetings for WeCommerce (TSXV: WE), while they write, “We remain confident in our positive view after an update with recently promoted CEO Alex Persson and new CFO David Charron.” They have lowered their 12-month price target from C$18 to C$16.50 and reiterated their buy rating on the stock.

WeCommerce only has 2 analysts covering the stock with an average 12-month price target of C$19.25, or a 53% upside to the current stock price. One analyst has a strong buy rating and the other has a buy rating.

Canaccord says that the WeCommerce shares look attractive as the pressure on software names has continued to persist, calling the company a “strong, cash flowing, captive customer and growth businesses at attractive valuation.”

In the notes, Canaccord says that the management reiterated its goals to be a profitable company with positive free cash flow. While Canaccord says that the company EBITDA margin is in the low 30% range, with any free cash flow reinvested into the company.

To piggyback off this, management also reiterated that there has been no fundamental change in strategy. After a number of key management changes, Canaccord believes that the new CEO has a strong understanding of the Shopify ecosystem and “has played a pivotal role in shaping and executing the company’s current strategy.”

Canaccord notes that the company says they continue to have a large pipeline of potential M&A. Canaccord says that the company tracks over 1000 companies and continues to be active “despite recent management changes.” Though management does believe that multiples could continue to go lower as “the slowdown in ecommerce from supply chain constraints and return to brick-and-mortar stores.”

And lastly, Canaccord says that the company is more constrained by their balance sheet than anything else, with the company reporting $24.6 million in cash, which includes a $50 million term loan and $12.6 million of a revolving credit facility used, they estimate roughly $50 million of liquidity on WeCommerce’s books. They do note that the company has roughly $30 million in earnouts coming due soon but that the company can settle it in either cash or equity.


Information for this briefing was found via Sedar and Refinitiv. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

Gold Is Screaming Higher While Currencies Burn | Simon Ridgway – Rackla Metals

We Have the Highest-Grade Antimony Deposit in North America!? | Jim Atkinson -Antimony Resources

New Found Gold: The Strategic Maritime Resources Purchase

Recommended

Canadian Copper Secures $8 Million Lead Order From Ocean Partners As Part Of Larger Funding Round

Northern Superior Expands Philibert With 350 Metre Step Out Testing 1.10 g/t Gold Over 25.5 Metres

Related News

Paypal: Consensus Price Target Jumps To $314 Following Q1 Results

Paypal Holdings (NASDAQ: PYPL) ended last week down almost 5% following the release of its...

Tuesday, May 11, 2021, 10:48:00 AM

Netflix: BMO Reiterates $700 Price Target Ahead Of Earnings

Netflix (NASDAQ: NFLX) is expected to report its third-quarter financials on today with a call...

Tuesday, October 19, 2021, 03:28:00 PM

Harvest Health: Canaccord Reiterates Price Target Following Earnings

On August 10, Harvest Health and Recreation (CSE: HARV) reported its second quarter results. The...

Thursday, August 12, 2021, 03:49:00 PM

Curaleaf: Canaccord Raises Price Target To $23.50

Wednesday, Canaccord came out with their updated valuations for the large three multi-state operators. In...

Saturday, January 16, 2021, 01:43:00 PM

Well Health: Consensus Price Target Climbs To $11.83 Following MyHealth Acquisition

WELL Health Technologies Corp. (TSX: WELL) this week announced that they would be acquiring MyHealth...

Thursday, June 10, 2021, 11:46:00 AM