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Questor Technology stock passes the $5.00 mark and can still double
Posted by: Gerry Wimmer
5/20/2019
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Questor Technology’s (TSXV: QST) share value has risen 1282% since first recommended by Investorfile and the financial results and outlook are stronger then ever, meaning the best is still to come.




Note: Investorfile's share price accumulation target of $0.65 for Questor Technology Inc. was reached on June 3, 2013. For the record, we do not revise share price targets for our Top Ideas - Small Cap Value Stocks. We have positioned our blog to be one of the first providers for 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.


About 13 months ago Investorfile said that Questor Technology’s shares will hit C$5.00 (See: Questor Technology could be a $5.00 stock again). Today the stock price is that and more.

Questor Technology Inc. (TSXV: QST - C$5.25) is a leading provider of waste gas combustion incineration solutions to improve air quality. The Company's proprietary incinerator technology--which is safe, reliable and very efficient--is deemed a best-of-breed clean-air solution for oil and gas producers needing to comply with stricter emission regulations now being enforced.

Over that past two years it should be no surprise that the share price for Questor Technology continues to have momentum.

Why? The numbers tell the story.

Last year the Company had its highest yearly revenue and earnings in history. Annual revenues were up 21% in 2018 to $23.5 million, and earnings increased 80% to C$0.27 per share. This year the financial results indicate even stronger growth. In Questor’s first quarter of 2019, revenue grew by 29% to $7.7 million, compared with the same period from 2018, while earnings per share jumped to C$0.09. The Company continues to have plenty of cash on its balance sheet and no debt.

What was behind the numbers in 2018 was the success of the Company’s strategy to establish a dominant presence in the State of Colorado with its rental fleet of incinerators, where there is enforcement of waste emission regulations for oil and gas producers. In 2019, Questor Technology has replicated this strategy in the State of North Dakota.

To date, revenue growth this year is largely the result of Questor securing long-term contracts for the use of its incinerators from oil and gas producers in the State of North Dakota who need to comply with the enforcement of waste emission regulations. The Company has said that North Dakota enforces emissions regulations in such a way that allows oil and gas companies which utilize Questor incinerators to be credited with an extremely high destruction efficiency, reducing the oil field’s emissions below the limit and hence, allowing higher oil production. This is a win-win situation which has created significant business opportunity for Questor Technology.

The Company continues to pursue other expansion opportunities in the USA with its initial entry into the States of Texas, Wyoming and New Mexico. In these markets, waste emission regulation for oil and gas fields is beginning to be enforced. To meet the expected demand for its incinerators, Questor is spending between C$7-10 million this year to expand its rental fleet, all of which can be funded from the Company’s existing cash holdings and cash flow.

Of note, C$1.8 million of revenues reported in the Company’s first quarter were the result of a purchase order to supply its clean combustion incineration technology with its power generation equipment at three oil and gas production facilities in Mexico, comprising a total project award amount of C$5.8-million. This order showcased the Company’s technologies as a method to eliminate gas flaring and methane for the oil and gas sector outside of the USA and Canada. Questor says Mexico has targeted methane gas reduction as part of its environmental objectives to reduce emissions by up to 75% by 2025. Hence, the Company is ambitious with its expectations for new business in Mexico, given the country’s aggressive objectives to address climate change within its mature oil and gas industry.

Above we have highlighted the many growth opportunities for Questor Technology which has helped propel the share price up an astounding 1,282% since the Investorfile blog first recommended the stock (See: Questor Technology Inc: A small cap clean-tech company that makes money) as one of its Top Ideas. But do not let the tremendous appreciation in share value fool you in thinking the best is over. Quite frankly the best is still to come.

That said we are of the opinion that Questor’s valuation metrics are poised for major re-rating and therefore could trade at least 20-times earnings going forward as the Company continues to execute on its growth plans. Therefore, based on the analysts' consensus forecast of C$0.43 and C$0.52 earnings-per-share (EPS) for 2019 and 2020 respectively, the stock could trade as high C$10.40 next year, which is almost, double its current trading price.

If the forecasts become reality, we will need to compose another blog post next year on Questor Technology when the stock price surpasses the C$10 mark!

Questor Technology has approximately 27.1 million shares outstanding.

The Company’s website www.questortech.com

Author Ownership Disclosure: TSXV: QST- 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 Questor Technology Inc. nor has it received any compensation from Questor Technology Inc. for the preparation or distribution of this article.

The author of this article has acquired and may trade shares of Questor Technology 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.