SNX - Climb Global Solutions: Cash Can Fund Acquisitions And Double Earnings By 2026
2024-05-09 00:55:48 ET
Summary
- Climb Global Solutions is a small software distributor with a market cap under $500 million that is ignored by institutional investors.
- The company operates in the cybersecurity and data center verticals, providing a better service to small software vendors and enabling it to take market share from larger competitors.
- Climb's large cash balance should fund M&A, which will drive higher-than-expected growth.
- I'm initiating coverage with a BUY rating and a two-year price target of $100, 75% above today's price.
Introduction
This year I have been conducting screens based on the criteria outlined in Chris Mayer’s classic 100 Baggers . I’m looking for very small companies with high profitability, impressive growth rates, solid balance sheets, and reasonable valuations. Climb Global Solutions ( CLMB ) came to my attention because it fit those criteria. The company, with a market cap under $500 million, is ignored by institutional investors. Only one analyst covers the stock and only three funds have more than 1% of their portfolios invested. Much of the institutional ownership is by index funds....
Climb Global Solutions: Cash Can Fund Acquisitions And Double Earnings By 2026