Strong Buy Rating for NTG Clarity Networks Driven by Robust Financial Performance and Growth Potential

In a report released today, Aravinda Galappatthige from Canaccord Genuity maintained a Buy rating on NTG Clarity Networks (NCI – Research Report), with a price target of C$3.00.

Aravinda Galappatthige has given his Buy rating due to a combination of factors that highlight NTG Clarity Networks’ strong financial performance and growth potential. The company reported a significant beat in its adjusted EBITDA for Q4/24, driven by robust revenue growth, particularly in Saudi Arabia, which saw a 109% year-over-year increase. This strong performance was supported by a substantial increase in contract wins, totaling $139.8 million in 2024, and a promising backlog of $105 million, indicating a solid revenue outlook.
Furthermore, NTG Clarity Networks maintains a compelling valuation with a 5.1x EV/EBITDA for 2025 and a free cash flow yield of 12.4% for 2026. The company’s guidance for 2025 remains optimistic, with expected revenue of $75 million and EBITDA margins between 16-20%. Additionally, the balance sheet is expected to turn net cash by Q2/25, providing financial flexibility for future growth. Despite a slight reduction in the target price due to corporate tax timing and working capital considerations, the company’s unique position in the Saudi Arabian market and support from Vision 2030 contribute to its resilience against macroeconomic challenges.