Initiating Coverage of CTG

We are initiating coverage of CTG, Inc. (CTG) with a price target of $8.00, representing a FY ’20 EV/EBITDA multiple of 8x. We believe the long-established provider of IT staffing and solutions services is effecting a strategic transition in its business by de-emphasizing lower margin staffing opportunities and focusing instead on higher margin, higher recurring revenue engagements part and parcel to its solutions business.

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K. Liu's Week in Review

With the holiday season upon us and a new year fast approaching, we were hit by a blizzard of news this week. After formally announcing a review of strategic alternatives in mid-November and cancelling a financial analyst day previously scheduled for this past week, Instructure (INST) agreed to be taken private by Thoma Bravo for $47.60 per share in cash, representing a TTM EV/Sales multiple of 7.6x.

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