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Validea's pick of the week provides a detailed report on a company that scores well in the stock-screening service's model portfolios. On Validea.ca, investors can analyze 1,000 Canadian stocks through 12 different guru-based models and get individual reports on each company. Globe Investor has a distribution agreement with Validea.ca. Try it.
IDT Corp., through its IDT Telecom division, provides retail telecommunications and payment services to help immigrants and the under-banked to conveniently and inexpensively communicate and share resources around the world. IDT Corp. has a market cap of $450-million (U.S.). Its wholesale business is a leading global carrier of international long distance voice calls. The firm also holds a majority interests in Zedge, a mobile content discovery and acquisition platform.
IDT Corp. has grown earnings per share at a 10-per-cent pace over long term (using an average of the 3 and 4 yr EPS growth rates) compared to 0-per-cent communications services industry average.
The company has a 3.8-per cent dividend yield, and it trades for just 4.9 times trailing 12-month EPS. That, its growth rate, and dividend yield make for a strong 0.35 yield-adjusted P/E-to-growth ratio, part of why the Peter Lynch-based model has strong interest.
IDT gets some interest from the Kenneth Fisher-based model, thanks to its 0.28 price/sales ratio and 4.4-per-cent total debt/equity ratio.
The company also has a stellar 75-per-cent return on equity (12-month), positive free cash flow ($0.65/share) and solid 74 relative strength (12-month).
John Reese is long IDT.
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