- One of the benefits of micro-cap stocks is that their underlying companies are often too small to garner much investor recognition, masking track records of long-term profitable growth for the active investor to uncover and take advantage of
- One name that may come up in your search is Pickering, Ontario-based AirIQ (TSXV:IQ), market capitalization C$10.77 million, a pioneering Internet of Things asset management solutions provider
- The company has posted impressive long-term financials and earned investors an impressive return in the process
One of the benefits of micro-cap stocks is that their underlying companies are often too small to garner much investor recognition, masking track records of long-term profitable growth for the active investor to uncover and take advantage of.
This content has been prepared as part of a partnership with AirIQ Inc., and is intended for informational purposes only.
An easy way to find these companies is by setting up a simple stock screener limiting market capitalization and one-year return, while setting some minimum measure of profitability, whether net income, free cash flow or adjusted EBITDA, depending on your preference and the industry involved, and proceeding to delve into income statements for worthwhile candidates with a demonstrated commitment to operating in service of shareholder value.
One micro-cap stock that may come up in your search is Pickering, Ontario-based AirIQ (TSXV:IQ), market capitalization C$10.77 million, a pioneering Internet of Things (IoT) asset management solutions provider. The company, founded in 1997, has put up some impressive long-term financials and earned investors an impressive return in the process, despite sometimes trading no more than a few thousand shares per day.
AirIQ has increased recurring revenue for the past nine years, including 10 per cent growth to C$4.8 million year-over-year, serving more than 10,000 clients to date with its fleet management solutions, such as video telematics and data analysis, helping them to increase productivity, reduce liability and prioritize customer satisfaction.
The company has supported its top line with positive net income since 2014, posting C$203,000 in the fiscal year ending March 2025 and a five-year-high of C$3.69 million in 2023 driven by a substantial deferred tax recovery.
AirIQ stock has responded accordingly to its underlying company’s profitability, adding 620 per cent from the start of fiscal 2014 to date, with Mike Robb, AirIQ’s president and chief executive officer, showing optimism about the company’s prospects for the future in the fiscal 2025 news release.
“The company has reported recurring revenue growth for the ninth straight year representing an increase of over 100 per cent during that period,” Robb stated. “Our investments in sales and marketing during the past year are also beginning to demonstrate a positive return. Subsequent to year-end, additional customer wins have resulted in our annualized recurring revenue having now surpassed the C$5.5 million threshold. We anticipate that continued sales and marketing success will generate even greater rates of growth in revenue and profitability in the future.”
With only 29.1 million shares outstanding, and the company actively buying back shares, investors stand to benefit from added leverage as AirIQ’s proven ability to grow at a profit continues to make waves in the market.
The micro-cap stock’s range-bound chart since 2020, representing only a 38.46 per cent gain, seems to be a response to inflationary as well as tariff concerns – given the company’s significant exposure to the U.S. – though these have proven to be overblown as evidenced by consistent profitability, indicating a potentially undervalued entry point for a long-term investment.
About AirIQ
AirIQ is a technology company helping commercial businesses monitor their assets in near real time. Its suite includes fleet reporting, maintenance, compliance, safety and analytics.
The micro-cap stock (TSXV:IQ) is unchanged trading at C$0.37 as of 10:24 am ET.
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