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30
Avante Logixx aspires to become big
Posted by: Gerry Wimmer
9/30/2018
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TOP IDEAS: Avante Logixx Inc. (TSXV: XX) is cashed up and ready to make a bigger splash with more acquisitions. Year-to-date the stock price is up 44%.




Investorfile's share price accumulation target of $0.40 for Avante Logixx Inc. was reached on January 7, 2014. For the record, we do not revise share price targets for our Investorfile Top Ideas - Small Cap Value Stocks. We have positioned our blog to be one of the first providers of a pragmatic perspective of a small cap company stock's potential worth, where there may be uncovered value that has been largely overlooked by the investment community.


Each September we regularly attend the Avante Logixx Inc. Annual General Meeting (AGM) which is one of the Investorfile blog's Top Ideas from several years back. But this year the AGM had a different feel. How so? The presentation room was packed with small cap fund managers and analysts alike keen to hear from the CEO about the Company’s growth plans.

Based in Toronto, Avante Logixx Inc. (TSXV: XX – C$0.46) provides best-in-class and high-end residential and commercial security services, including system design and installation, rapid alarm response, alarm monitoring, video analytics, locksmith services and hardware and secure transport through the use of advanced technology, with a focus on client service.

It has been nine months since Craig Campbell was appointed CEO of Avante Logixx and became a major shareholder in the Company. Mr. Campbell is a veteran security industry entrepreneur. He was the founder and CEO of Total Security Management (TSM), a full-service security provider which grew to become Canada’s largest privately held security firm, with over 3,000 employees and operations across the country, after which time it was acquired by Garda World Security.

From the presentation at the AGM, this CEO has a big vision for Avante Logixx. This includes deploying between C$50 to $75 million of expansion capital in the first three years of his tenure and to acquire another beachhead vertical within the security industry, in addition to making tuck-in acquisitions. The Company already conducted a realignment of its corporate structure to build a solid platform for future growth and continues to hire senior officers. Avante Logixx’s Board of Directors has also had some notable additions.

This vision of growth through acquisitions has already started to play out. The Company has already completed three transactions over the summer. The first two were tuck-ins: the purchase of the remaining 49% interest in Architronics and the acquisition of Watermark Security. Veridin Systems (with annual revenues of C$5 million) was the third acquisition, which expanded the Company’s commercial security footprint while gaining large nationwide accounts. Now Avante Logixx has an annual revenue run-rate that is approaching C$30 million.

But the Company’s growth trajectory does not stop here.

This month, Avante Logixx announced a C$10 million loan facility from the Royal Bank of Canada for future acquisitions. We note that the Company has significant cash on hand from a recent equity financing and no debt, giving it the financial capacity to undertake bigger purchase transaction(s) going forward.

The Investorfile blog is of the opinion that there will be significant M&A activity to take Avante Logixx to the next level, thus making it a national market leader for high-quality security services. For small cap investors, M&A could continue to fuel the stock’s valuation this year.

Last week the Company announced a strategic partnership and investment with 3|Sixty Secure Corp., a leading Cannabis security solutions provider. This will foster new commercial customers from the Cannabis sector for Avante Logixx.

Year-to-date, the stock price of Avante Logixx is up 44%. Several analysts rate the stock a buy with 12-month share price targets currently set at C$0.65.

Avante Logixx has about 105.2 million shares outstanding. Pending is a 1 for 5 share consolidation.

Company website: www.avantelogixx.com

Author Ownership Disclosure: TSXV: XX - Yes


Read Disclaimer:

This article is for informational purposes only. This article is based on the author's independent analysis and judgment and does not guarantee the information's accuracy or completeness. The information contained in this article is subject to change without notice, and the author assumes no responsibility to update the information contained in this article. The information contained within this article should not be construed as offering of investment advice. Those seeking direct investment advice, should consult a qualified, registered, investment professional. This is not a direct or implied solicitation to buy or sell securities. Readers are advised to conduct their own due diligence prior to considering buying or selling any stock.

Investorfile.com is not engaged in an investor relations agreement with Avante Logixx Inc. nor has it received any compensation from Avante Logixx Inc. for the preparation or distribution of this article.

The author of this article has acquired and may trade shares of Avante Logixx Inc. through open market transactions and for investment purposes only.

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Hi Gerry, Your philosophy is focused on principles that have been shown to produce above average results over time and your record has clearly proven that. Congratulations on a great blog and thank you for the hard work that you do in sharing and updating your ideas; it is much appreciated.