Kinaxis Inc. (TSX:KXS) stock was up 7.92% in late morning trading on January 23. Shares are up 25% year over year. The surge came after the company announced that Toyota Motor Corp. had selected Kinaxis to manage its automotive demand and supply chain processes.
The news is big for Kinaxis as the stock entered a period of volatility after its second quarter results in 2017. The loss of a large Asia-based customer due to a breach of contract forced the company to adjust its forecasts for 2017. That loss should be lessened somewhat after obtaining a deal with the second-largest automobile manufacturer in the world.
Kinaxis released its 2017 third quarter results on November 2, 2017. Revenue was up 12% year over year to $33.5 million and gross profit jumped 16% to $23.8 million. For the full year the company is projecting revenue in the range of $132 million to $134 million and expects annual subscription revenue to grow from 22% to 23%.
Kinaxis stood out before this deal as an attractive long-term hold. Now, before releasing its fourth quarter results, the company has seemingly recovered from its mid-2017 setback. The stock has climbed over 500% since making its 2014 debut on the Toronto Stock Exchange (TSX). Large and small businesses alike are moving to improve and modernize processes as we look ahead, and Kinaxis offers comprehensive supply chain solutions. It remains a premier growth stock on the TSX in early 2018.
