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Editor's notes: The wireless broadband company's acquisition of a data center company should add earnings and fit in well with Terago's recurring revenue model. Another catalyst for this cheaply valued Canadian stock.

TeraGo OTC:TRAGF Investment Thesis

TeraGo's revenue visibility, steady growth, and intelligent capital allocation make it a solid long-term investment. The company has grown its customer locations from just over 4,700 in FY09 to ~6,600 at the end of FY12. TeraGo boasts a much lower churn rate than its competitors and has been able to grow ARPU (average revenue per user) steadily over the last couple of years. Lastly, management just announced a smart acquisition that looks like it will prove to be accretive immediately while not adding any business risk to TeraGo's operations. This will be the focus of my article, but I will provide a brief business overview first.

Business Overview

TeraGo offers wireless broadband communications services to...

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