CA - Savaria - The Only Way Is Up
2024-04-10 17:52:23 ET
Summary
- Savaria Corporation is a relatively unknown company in the mobility solutions industry, catering to the physically challenged.
- The company has experienced rapid growth in revenue and EBITDA over the past five years, but net income has declined.
- Management has invested in transforming the business performance, hiring new executives and setting ambitious targets for 2025.
- Demographic tailwinds and a transformational management provide a strong case for both revenue and margin expansion.
Savaria Corporation ( SISXF ), is a relatively unknown company in the fast growing, if not sexy, business of mobility solutions for the physically challenged. Their product mix includes both in home and vehicular mobility aids. With an aging and increasingly obese population, demand for these products is growing.
The business has grown rapidly, increasing revenues and EBITDA by close to 300% in the last five years. Net income, however, has not kept pace, dropping from 6.2% of revenue to 4.5% over the period. Cost of debt is the culprit here. The interest expense increased by 1.7% of revenues, bringing the margin down commensurately....
Savaria - The Only Way Is Up