tiprankstipranks
Dye & Durham Stock (TSE:DND) Soars 17.4% — Here’s Why
Market News

Dye & Durham Stock (TSE:DND) Soars 17.4% — Here’s Why

Story Highlights

Dye & Durham stock rallied over 17% today after announcing Q4-2022 and full-year earnings results as well as announcing a buyback plan that pleased investors. The results were solid, and the buyback plan implies that the stock is undervalued. In addition, analysts expect high upside potential from DND.

Shares of Dye & Durham (TSE: DND) finished 17.35% higher today despite the S&P 500 (SPXdeclining by 0.21%. In the past day, DND shared two important pieces of news. The first was its Fiscal Q4-2022 and full-year earnings results. The second piece of news was that DND is starting a normal course issuer bid (share buybacks). The market seemed to like these announcements, sending shares higher.

Dye & Durham’s Q4-2022 and Full-Year Results

For the fourth quarter, revenue came in at C$129.7 million, a 54% increase year-over-year. Meanwhile, adjusted EBITDA and net income came in at C$75.2 million and -C$3.3 million, respectively. Adjusted EBITDA grew 53%, and net income turned negative, as it was C$6.3 million in the same period last year. These results were slightly better than the preliminary results released just two weeks ago.

For the full year, revenue increased by 127%, reaching C$474.8 million. Net income also increased, going from -C$40.9 million to C$7.8 million. Lastly, Dye & Durham’s adjusted EBITDA grew by 129% for the full year, coming in at C$266.9 million. Lastly, DND’s operating cash flow increased from C$79.35 million to C$185.44 million.

Dye & Durham Announces Share Buybacks

This morning, Dye & Durham announced that it intends to repurchase up to 3,457,508 of its shares over the next year. This amounts to about 5% of its outstanding shares. The company will be able to buy back its shares starting September 30. This is a sign that management believes that DND stock is undervalued.

Is Dye & Durham Stock a Buy, According to Analysts?

Turning to Wall Street, DND has a Strong Buy consensus rating based on three Buy ratings. The average Dye & Durham price target of C$30.50 implies 98.7% upside potential. 

One of the Buy ratings comes from five-star-rated analyst Robert Young, who is ranked #220 out of 7,962 analysts on TipRanks. Young has an average return per rating of 15.7% (measured on a one-year basis). He reiterated a Buy rating two days ago, giving the stock a C$38 price target.

Conclusion: Solid Results and Buybacks Sparked a Rally

Dye & Durham released solid results that showed very high revenue and cash-flow growth. In addition, due to its recent plunge, management now believes that the stock is undervalued, starting a share buyback plan. This was enough to send the stock more than 17% higher today while the overall market struggled.

Disclosure

Trending

Name
Price
Price Change
S&P 500
Dow Jones
Nasdaq 100
Bitcoin

Popular Articles