Cliff Note #118 - Data Center & Cell Tower Power Infrastructure Theme Quietly Percolating

Themes: GARP - New Data Center Theme - Margin Expansion - Legacy Industry Stabilization

We are adding another stock to our Microcap Quality Index (MSMqi) with ties to one of our favorite data center theme, power management solutions (like TGEN). It also seems that the legacy business might be stabilizing, providing an opportunity for the higher margin and higher growth potential power management solutions business to turn this company from a boring cyclical story to one of consistent growth.

At this time, it appears that analyst estimates do not materially account for EBITDA margin expansion goals and much growth in the power segment, leaving room for upside surprises. We also don’t think it’s wildly known that the segment also has recurring revenue potential, related to remote monitoring services.

Themes: GARP - New Data Center Theme - Margin Expansion - Legacy Industry Stabilization