Sierra is the better buy right now

Article Excerpt

SIERRA WIRELESS $18.19 (Toronto symbol SW; TSINetwork Rating: Extra Risk) (604-231-1100;; Shares outstanding: 36.1 million; Market cap: $645.7 million; No dividends paid) makes digital components that connect products, including smart electricity meters, automobiles, fleet and transit vehicles, and home security systems, to the Internet. That machine-to-machine networking is commonly known as the “Internet of Things.” In the quarter ended September 30, 2018, Sierra made sales of $203.4 million. That’s a 17.9% jump from $172.6 million a year earlier (all figures except share price and market cap in U.S. dollars). Excluding one-time items, the company earned $10.5 million, or $0.29 a share. That was up 36.4% from $7.7 million, or $0.24, a year earlier. Sierra sold more high-profit-margin products in the quarter. To remain competitive, the company spends a high 12% of its revenue on research and development. It also buys firms with technology and products that it can use for its existing business. Most recently, Sierra acquired Numerex Corporation (symbol NMRX on Nasdaq) for $107…

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