Several Canadian tech companies have reported upbeat quarterly financial results this month, but disappointing guidance for the year ahead has hammered share prices. Should investors bet on rebounds?) offers one of the earliest – and clearest – examples of this trend. The share price plummeted 14.8 per cent on May 3, even though the information management software company reported results that were roughly in line with analysts’ expectations and underscored a thriving business.
“That would suggest that either the former outlook was overly robust, or something has eroded in the core business,” Mr. Tse said in a note. But management’s full-year outlook was the sticking point. The company expects revenue growth of 17 per cent to 18 per cent, which is considerably lower than the 22.5 per cent growth that analysts had been expecting, on average.) fell 18.7 per cent after reporting its quarterly results earlier this month. The IT services company, controlled by Telus Corp., offered an outlook that looks challenging, with projected revenue growth of just 3 per cent to 5 per cent.
The other takeaway is that with corporate guidance swinging wildly from one quarter to the next, even top executives may be at a loss to explain how their companies are faring as they try to balance growth prospects against rising demands from investors to show profits.Telus International has swung from a premium relative to its peers – in terms of enterprise value to EBITDA – to a valuation that lines up with its competitors. And Mr.