John Leonard, CFA
Special situations, micro-cap, contrarian, CFA

Innovative Solutions & Support Is Overlooked With A Significant Near-Term Catalyst

Company overview

Innovative Solutions & Support (NASDAQ:ISSC) supplies flight information computers, electronic displays and advanced monitoring systems to the civil, military, business and commercial markets.

A false start before rapid growth

Although ISSC jumped 22% after releasing earnings last month, it has since given back almost two-thirds of the gains, providing an attractive entry point.

In the mrq, revenue increased 70% to $11.1 million driven primarily by higher display shipments for retrofit programs and customer support of its engineering development programs while operating income increased 266%. These results are even more impressive considering that 37% of revenue was invested in product development.

Management expects continued top and bottom line growth in FY14 during the transition from...

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