Topic: How To Invest

Small cap stocks: Calian Technologies reports higher earnings

Calian Technologies, symbol CTY on Toronto, operates in two areas: the business and technology services division, which accounts for 74% of Calian’s revenue, provides engineers, health-care workers and other skilled professionals to clients on a contract basis. The small cap stock’s systems-engineering division contributes the remaining 26% of revenue, and sells hardware and software that is used for testing, operating and managing satellite and other communications systems.

In the three months ended March 31, 2011, the small cap stock’s revenue rose 11.9%, to $59.4 million from $53.1 million a year earlier.

Earnings rose 6.5%, to $3.3 million from $3.1 million. Earnings per share rose 5.0%, to $0.42 from $0.40, on more shares outstanding. Calian earned higher profit margins on the business and technology service division’s contracts. That pushed up the company’s overall earnings. The strong Canadian dollar held back the systems-engineering division’s earnings.

The company holds cash of $25.3 million, or $3.29 a share, and has no debt.

Calian pays dividends at annual rate of $1.00 a share. That gives the shares a 5.3% yield.

We updated our advice on Calian in our May 20, 2011 Stock Pickers Digest hotline, which you can immediately view when you take a 1-month free trial to Stock Pickers Digest. Click here to get started right away.

(Note: If you are a current Stock Pickers Digest subscriber, please click here to view Pat’s recommendation. Be sure to log in first.)

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