So, PFB doesn't fit the criteria for our screener. We do require markets caps to be over $250 million to produce accurate reports. However, have no problem providing an opinion on the company.
This is actually a company we've had our eye on here at Premium, but right now with a market cap in the $150M range, it doesn't quite meet our Bull List criteria, and doesn't have enough consistent history behind it.
Revenue is flat in 2020, but this is somewhat to be expected because of the COVID-19 pandemic. Although revenue is flat, company has driven very strong EBITDA growth.
It's also expanding its US sales, which is allowing it to enter a much larger market. The company had $15 million in US sales in 2011 and now sits at $55 million thus far this year. In terms of total revenue, US sales made up 17% in 2011 and now make up 41.4%. In fact, its US segment is what is driving most of the company's growth right now.
Profit margins have been consistently increasing, and the company has an excellent balance sheet.
The only immediate concern I would have is the cyclical nature of the business, as well as the fact the company dished out a $1 special dividend. Now, I'm not one to complain about receiving a special dividend, but with a growth company it can be a sign that it is having troubles finding ways to spend retained earnings to drive internal growth, so instead it pays it out as a dividend.
We saw this with Enghouse this year, but this is a company that has proven it can grow via acquisition and it paid out a special dividend because acquisitions were not a viable strategy in 2020. This may be the case with PFB as well, but it's something to keep an eye on.
I'd be curious to see how PFB fuels growth in 2021. The company states they want to grow revenue to $200 million, but they really don't have a specific timeline as to when.