Thursday, May 04, 2023
Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
The Strategy is Working. Posting record quarterly revenue and improved margins for the quarter indicates management’s growth strategy is working. We believe CVG is at an inflection point for improved growth and margins. The Company is well on its way to achieving its 2027 goal of $1.5 billion in revenue and 9% adjusted EBITDA margin, in our view.
Volume, Price Driving Top Line. Record first quarter revenue was driven by a combination of volume and price, with volume contributing about 60% of top line growth in the quarter and price the other 40%. CVG spent considerable energy in 2022 seeking out more favorable pricing to reflect current operating realities. The final major contract was redone in the first quarter of 2023 and began contributing at the beginning of April.
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