NasdaqCM:TCX

Stock Analysis Report

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Executive Summary

Tucows Inc. provides network access, domain name registration, email, mobile telephony, and other Internet services in Canada, the United States, and Europe.

Risk Analysis

Has a high level of debt



Snowflake Analysis

Questionable track record with imperfect balance sheet.


Similar Companies

Share Price & News

How has Tucows's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

3.4%

TCX

1.0%

US IT

2.3%

US Market


1 Year Return

12.2%

TCX

14.7%

US IT

6.7%

US Market

Return vs Industry: TCX underperformed the US IT industry which returned 14.1% over the past year.

Return vs Market: TCX exceeded the US Market which returned 6% over the past year.


Shareholder returns

TCXIndustryMarket
7 Day3.4%1.0%2.3%
30 Day-4.8%2.0%-0.7%
90 Day12.4%24.4%17.1%
1 Year12.2%12.2%15.8%14.7%9.0%6.7%
3 Year0.4%0.4%98.1%90.1%36.7%27.8%
5 Year122.8%122.8%144.1%123.6%65.2%46.9%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Tucows undervalued compared to its fair value and its price relative to the market?

40.88x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: TCX ($59.41) is trading above our estimate of fair value ($43.76)

Significantly Below Fair Value: TCX is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: TCX is poor value based on its PE Ratio (40.9x) compared to the IT industry average (27.7x).

PE vs Market: TCX is poor value based on its PE Ratio (40.9x) compared to the US market (16.1x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: TCX is overvalued based on its PB Ratio (6.6x) compared to the US IT industry average (3.5x).


Next Steps

Future Growth

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

24.3%

Forecasted Software 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 Tucows 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 Tucows performed over the past 5 years?

9.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TCX has high quality earnings.

Growing Profit Margin: TCX's current net profit margins (4.5%) are lower than last year (4.9%).


Past Earnings Growth Analysis

Earnings Trend: TCX's earnings have grown by 9.4% per year over the past 5 years.

Accelerating Growth: TCX's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: TCX had negative earnings growth (-4.6%) over the past year, making it difficult to compare to the IT industry average (14.5%).


Return on Equity

High ROE: TCX's Return on Equity (16.2%) is considered low.


Next Steps

Financial Health

How is Tucows's financial position?


Financial Position Analysis

Short Term Liabilities: TCX's short term assets ($136.5M) do not cover its short term liabilities ($162.7M).

Long Term Liabilities: TCX's short term assets ($136.5M) do not cover its long term liabilities ($179.8M).


Debt to Equity History and Analysis

Debt Level: TCX's debt to equity ratio (119.1%) is considered high.

Reducing Debt: TCX's debt to equity ratio has increased from 10.3% to 119.1% over the past 5 years.

Debt Coverage: TCX's debt is well covered by operating cash flow (40%).

Interest Coverage: TCX's interest payments on its debt are well covered by EBIT (6.1x coverage).


Balance Sheet


Next Steps

Dividend

What is Tucows's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

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

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


Stability and Growth of Payments

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

Growing Dividend: Insufficient data to determine if TCX'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 TCX's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.4yrs

Average management tenure


CEO

Elliot Noss (57yo)

21.17yrs

Tenure

US$536,855

Compensation

Mr. Elliot Noss has been the Chief Executive Officer and President of Tucows Inc. since May 1999. Mr. Noss has been a leader in the Internet industry for ten years. From May 1999 to August 2001, he served  ...


CEO Compensation Analysis

Compensation vs Market: Elliot's total compensation ($USD536.86K) is below average for companies of similar size in the US market ($USD3.16M).

Compensation vs Earnings: Elliot's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Elliot Noss
President21.17yrsUS$536.86k6.82% $42.8m
Davinder Singh
CFO, Executive VP3.25yrsUS$288.82kno data
Hanno Liem
Chief Technology Officer2.5yrsUS$259.14kno data
Bret Fausett
Chief Legal Officer & General Counsel2.83yrsUS$346.83k0.26% $1.7m
David Woroch
Executive Vice President of Domains6.5yrsUS$362.79k1.18% $7.4m
Jessica Johannson
Chief People Officer3.5yrsno datano data
Ross Rader
Chief Customer Officer8.5yrsno data0.41% $2.6m
Thorsten Einig
Managing Director of Europe9.75yrsno datano data
Michael Goldstein
Chief Revenue Officer of Ting1yrUS$419.22k0.040% $249.5k
Justin Reilly
Chief Product Officer0.83yrno datano data

3.4yrs

Average Tenure

48yo

Average Age

Experienced Management: TCX's management team is considered experienced (3.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Elliot Noss
President21.17yrsUS$536.86k6.82% $42.8m
Bradford Burnham
Independent Director3.5yrsUS$84.04k0.25% $1.6m
Jeffrey Schwartz
Independent Director15.08yrsUS$115.54k0.082% $512.4k
Allen Karp
Independent Chairman & Lead Director of the Board7.83yrsUS$130.54k0.14% $899.6k
Erez Gissin
Independent Director18.92yrsUS$96.04k0.098% $617.1k
Robin Chase
Independent Director5.75yrsUS$96.04k0.041% $259.9k
Rawleigh Ralls
Independent Director11.17yrsUS$111.04k0.021% $134.4k

11.2yrs

Average Tenure

61yo

Average Age

Experienced Board: TCX's board of directors are seasoned and experienced ( 11.2 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

Company Information

Tucows Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Tucows Inc.
  • Ticker: TCX
  • Exchange: NasdaqCM
  • Founded: 1992
  • Industry: Internet Services and Infrastructure
  • Sector: Software
  • Market Cap: US$627.826m
  • Shares outstanding: 10.57m
  • Website: https://www.tucows.com

Number of Employees


Location

  • Tucows Inc.
  • 96 Mowat Avenue
  • Toronto
  • Ontario
  • M6K 3M1
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TCXNasdaqCM (Nasdaq Capital Market)YesCommon StockUSUSDAug 2001
TUQ1DB (Deutsche Boerse AG)YesCommon StockDEEURAug 2001
TCTSX (The Toronto Stock Exchange)YesCommon StockCACADAug 2001
0LH4LSE (London Stock Exchange)YesCommon StockGBUSDAug 2001

Biography

Tucows Inc. provides network access, domain name registration, email, mobile telephony, and other Internet services in Canada, the United States, and Europe. It operates through two segments, Network Access Services and Domain Services. The Network Access Services segment offers mobile services under the Ting Mobile name, including the sale of retail telephony services, mobile phone hardware, and related accessories. It also provides roaming service to international travelers under the Zipsim and Always Online Wireless names; fixed high-speed Internet access services to consumer and business customers; network consulting services; and billing, provisioning, and customer care software solutions to Internet Service Providers (ISPs) through its Platypus billing software. This segment distributes its products and services through the Ting Website, as well as through third-party retail stores and online retailers. The Domain Services segment offers wholesale and retail domain name registration services; portfolio services; and value-added services, such as hosted email, Internet security services, Internet hosting, WHOIS privacy, publishing tools, and other value-added services for end-users under the OpenSRS, eNom, Ascio, and Hover brands. The company was formerly known as Infonautics, Inc. and changed its name to Tucows Inc. in August 2001. Tucows Inc. was incorporated in 1992 and is headquartered in Toronto, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/08 23:58
End of Day Share Price2020/07/08 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


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.