Converge Technology Solutions Corp.’s share price aligns with revenue sentiment.

January 31, 2024

Converge Technology Solutions Corp. (TSE:CTS) has a price-to-sales (P/S) ratio of 0.4x, which is lower than the average P/S ratio in the IT industry in Canada. This suggests that investors are expecting limited future growth for the company.

The company has been performing well in terms of revenue growth, with a 47% increase in the last year and a total growth of 208% over the last three years. However, analysts predict that the company’s revenue will only grow by 4.5% per annum over the next three years, compared to the industry’s expected growth of 13% per year.

As a result, investors are not willing to pay a higher price for the stock and the P/S ratio remains low. The company will need to show a change in its revenue growth in order to justify a higher P/S ratio in the future.

It’s important to note that investing in Converge Technology Solutions comes with some risk, and investors should consider their own objectives and financial situation before making any investment decisions.