Paragon Technologies(PTG), a provider of material handling automation systems, is quietly building a solid book of business. In August, the company announced that its backlog for orders had increased to $10.7M versus $5.9M in the beginning of the year. Acting CEO Len Yurkovic then stated that “the 81% increase in the backlog of orders lays an excellent foundation for financial performance for the remainder of the fiscal year.”
Since August, Paragon has continued to book new business. In early October, it was awarded a $1M contract for an automated light-picking system and a $1.6M contract to expand an order fulfillment system. PTG is a small company with an enterprise value of only $9.08M, so the contracts and the overall backlog are quite significant.
Technically, the stock is nearing its July 2007 high and may consolidate or pullback near this resistance level. Long term, though, I expect PTG investors will enjoy substantially higher prices.
DISCLOSURE: No position.