Arrow Capital Portfolio Manager, Alex Ruus, was more than positive in his response to a caller who asked about FLYHT Aerospace during last night’s (December 5th) appearance on Canada’s Business News Network (BNN). This was his response:
We like it very much and good timing. I actually sat down and had dinner with the CEO of FLYHT last week. Things are just going great. The business continues to develop. The Chinese business has been a particularly bright area in the last year and is growing strongly; looks to potentially even accelerate some more next year. Meanwhile, they continue to work with a number of global OEMs on doing business. They are on the production lines at Airbus and up on Bombardier, and we think that there are opportunities in other areas.
Meanwhile, there is increasing pressure for increased regulation in terms of flight following. At some point in the next two to three years, you could see something happen that accelerates adoption of a lot of their solutions. This is like an internet of things type company. People never talk about it that way. But it really fits into that increasing data off of industrial machinery, which in this case is airplanes. Again really critical information, which helps them fine tune the operation of the plane, prevents accidents and if there is an accident give you immediate information to know what’s happening.
We think at some point this thing is really going to take off, it has been a frustrating stock. It kind of flat lined over the last year, despite becoming profitable in the summer, it’s likely going to finish the year profitable and growing at almost 50% a year rate. So, we are scratching our head a little bit as to why the stock is trading at the 20 cent area, we argue it should be trading substantially higher.
To watch the segment, please click here.