TSX:RDL

Stock Analysis Report

Redline Communications Group

Executive Summary

Redline Communications Group Inc., together with its subsidiaries, develops broadband fixed wireless base stations, subscriber stations, and network management systems for point-to-point and point-to-multipoint applications for commercial end-users.


Snowflake Analysis

Flawless balance sheet and overvalued.


Similar Companies

Share Price & News

How has Redline Communications Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: RDL has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.5%

RDL

0.7%

CA Communications

-0.2%

CA Market


1 Year Return

-1.6%

RDL

0.9%

CA Communications

9.4%

CA Market

Return vs Industry: RDL underperformed the Canadian Communications industry which returned -1.5% over the past year.

Return vs Market: RDL underperformed the Canadian Market which returned 10.4% over the past year.


Shareholder returns

RDLIndustryMarket
7 Day2.5%0.7%-0.2%
30 Day3.4%4.8%1.8%
90 Day-2.4%4.5%6.3%
1 Year-1.6%-1.6%1.5%0.9%12.9%9.4%
3 Year-42.2%-42.2%-8.8%-10.6%17.1%6.5%
5 Year-56.1%-56.1%-31.8%-34.1%37.3%17.2%

Price Volatility Vs. Market

How volatile is Redline Communications Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Redline Communications Group undervalued compared to its fair value and its price relative to the market?

0.99x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: Insufficient data to calculate RDL's fair value to establish if it is undervalued.

Significantly Below Fair Value: Insufficient data to calculate RDL's fair value to establish if it is undervalued.


Price To Earnings Ratio

PE vs Industry: RDL is unprofitable, so we can't compare its PE Ratio to the Communications industry average.

PE vs Market: RDL is unprofitable, so we can't compare its PE Ratio to the Canadian market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate RDL's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: RDL is good value based on its PB Ratio (1x) compared to the CA Communications industry average (1.3x).


Next Steps

Future Growth

How is Redline Communications Group forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

84.4%

Forecasted Tech industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Redline Communications Group has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Redline Communications Group performed over the past 5 years?

-20.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RDL is currently unprofitable.

Growing Profit Margin: RDL is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: RDL is unprofitable, and losses have increased over the past 5 years at a rate of -20.2% per year.

Accelerating Growth: Unable to compare RDL's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: RDL is unprofitable, making it difficult to compare its past year earnings growth to the Communications industry (12.6%).


Return on Equity

High ROE: RDL has a negative Return on Equity (-13.7%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Redline Communications Group's financial position?


Financial Position Analysis

Short Term Liabilities: RDL's short term assets ($22.5M) exceed its short term liabilities ($8.2M).

Long Term Liabilities: RDL's short term assets ($22.5M) exceed its long term liabilities ($823.5K).


Debt to Equity History and Analysis

Debt Level: RDL's debt to equity ratio (4.3%) is considered satisfactory.

Reducing Debt: RDL's debt to equity ratio has reduced from 21.5% to 4.3% over the past 5 years.


Balance Sheet

Inventory Level: RDL has a high level of physical assets or inventory.

Debt Coverage by Assets: RDL's debt is covered by short term assets (assets are 32.4x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: RDL has sufficient cash runway for more than 3 years based on its current free cash flow.

Forecast Cash Runway: RDL has sufficient cash runway for more than 3 years if free cash flow continues to reduce at historical rates of -9.8% each year


Next Steps

Dividend

What is Redline Communications Group's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.9%markettop25%5.5%industryaverage2.9%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate RDL's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate RDL's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if RDL's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if RDL's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of RDL's dividend in 3 years as they are not forecast to pay a notable one for the Canadian market.


Next Steps

Management

What is the CEO of Redline Communications Group's salary, the management and board of directors tenure and is there insider trading?

0.9yrs

Average management tenure


CEO

Stephen J. Sorocky 0

0.8yrs

Tenure

US$64,438

Compensation

Mr. Stephen J. K. Sorocky, B.A.Sc., MBA, P.Eng, C.Dir. has been Chief Executive Officer of Redline Communications Group Inc. since March 14, 2019 and as its Director since June 20, 2018. He served as the C ...


Management Age and Tenure

0.9yrs

Average Tenure

Experienced Management: RDL's management team is not considered experienced ( 0.9 years average tenure), which suggests a new team.


Board Age and Tenure

3.5yrs

Average Tenure

60yo

Average Age

Experienced Board: RDL's board of directors are considered experienced (3.5 years average tenure).


Insider Trading

Insider Buying: RDL insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyCA$13,00021 Nov 19
Stephen J. Sorocky
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares10,000
Max PriceCA$1.30
BuyCA$93821 Aug 19
David McDonnell
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares700
Max PriceCA$1.34
BuyCA$6,02120 Aug 19
David McDonnell
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares4,300
Max PriceCA$1.43
BuyCA$83,04329 Mar 19
Stephen J. Sorocky
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares50,000
Max PriceCA$1.67
BuyCA$49,23018 Mar 19
Stephen J. Sorocky
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares30,000
Max PriceCA$1.64
SellCA$435,81208 Feb 19
Philippe de Gaspé Beaubien
EntityIndividual
Shares369,332
Max PriceCA$1.18
SellCA$2,628,13708 Feb 19
T Investment Corp
EntityCompany
Shares2,227,235
Max PriceCA$1.18
SellCA$1,98404 Feb 19
T Investment Corp
EntityCompany
Shares1,600
Max PriceCA$1.24
SellCA$296,40829 Jan 19
T Investment Corp
EntityCompany
Shares238,900
Max PriceCA$1.24

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Stephen J. Sorocky

    CEO & Director

    • Tenure: 0.8yrs
    • Compensation: US$64.44k
  • Abdel-Salam Aldwikat

    Vice President of Operations & Technology

    • Tenure: 2.9yrs
    • Compensation: US$199.00k
  • Philip Jones

    Chief Financial Officer

    • Tenure: 0.2yrs
  • Reno Moccia

    Executive Vice President of Global Sales & Marketing

    • Tenure: 1yrs

Board Members

  • Eric Demirian (60yo)

    Independent Director

    • Tenure: 6.6yrs
    • Compensation: US$147.31k
  • Nizar Somji (60yo)

    Independent Chairman of the Board

    • Tenure: 3.5yrs
    • Compensation: US$173.60k
  • David McDonnell (60yo)

    Independent Director

    • Tenure: 0.6yrs
  • David Roberts (66yo)

    Independent Director

    • Tenure: 3.8yrs
    • Compensation: US$144.73k
  • Stephen J. Sorocky

    CEO & Director

    • Tenure: 0.8yrs
    • Compensation: US$64.44k

Company Information

Redline Communications Group Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Redline Communications Group Inc.
  • Ticker: RDL
  • Exchange: TSX
  • Founded: 1999
  • Industry: Communications Equipment
  • Sector: Tech
  • Market Cap: CA$21.003m
  • Shares outstanding: 17.22m
  • Website: https://www.rdlcom.com

Number of Employees


Location

  • Redline Communications Group Inc.
  • 302 Town Centre Boulevard
  • 4th Floor
  • Markham
  • Ontario
  • L3R 0E8
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RDLTSX (The Toronto Stock Exchange)YesCommon SharesCACADOct 2007
RDLC.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDOct 2007

Biography

Redline Communications Group Inc., together with its subsidiaries, develops broadband fixed wireless base stations, subscriber stations, and network management systems for point-to-point and point-to-multipoint applications for commercial end-users. It operates through Hardware and Software Products, Professional Services and 3rd Party Equipment, and Maintenance and Support segments. The company offers Ellipse, a series of base stations; Edge and Elte wireless terminals; Enterprise, a wireless customer premise equipment; RAS-Elite, a portable auto-acquire outdoor wireless solution; RAS-Extend, a mechanical auto tracking system; RDL-3000 Connect, a series of remote terminals; PoE, an industrial grade power injector; and FlexCore, an EPC software. It also provides RDL-6000, a base station; and ClearView, a network management software, as well as antennas, cables, mounting kits, POE injectors, and surge protectors. In addition, the company offers installation, engineering, cell planning, site planning, project management, and training services; and repair and replacement services. It serves energy, government, military, service provider, enterprise, and digital divide markets through regional distributors, channel partners and systems integrators. The company has operations in the Americas, the Middle East, Europe, Africa, and the Asia Pacific. Redline Communications Group Inc. has a strategic collaboration with Blue Danube Systems to deploy 3D beamforming solutions in private LTE/5G networks. The company was founded in 1999 and is headquartered in Markham, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/01/26 00:13
End of Day Share Price2020/01/24 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.