Investors have sold off shares of Macquarie Telecom Group Ltd (ASX: MAQ) in recent weeks, pushing prices 11% lower this past month of trade.
At the time of writing, the MAQ share price is also down 13% this year to date, fetching $63.37 apiece at the close on Friday.
Despite the downward pressure, market pundits still see value in the stock, sliding against the market's view on the company.
Beaten down, but not beaten
When asked about resilient stocks on his radar recently, Gary Rollo from Montgomery Investment Management was straight to the point in naming Macquarie Telecom.
The data centre player has "got major clients like the cloud hyper-scalers as clients… growing their business pretty strongly and also the Aussie government," he noted when speaking to Livewire's Buy, Hold, Sell.
"They're basically digitalising more rapidly than the market probably expects."
Rollo added the strength of Macquarie Telecom's balance sheet and that he saw "great numbers in the second half" from the company.
In the group's latest earnings results, revenue saw a 4% uptick to $149 million whereas pre-tax earnings came in 11% higher at $40.5 million.
From this amount, operating cash flows were reported at $37.6 million, a year-on-year gain of more than $10 million. Rollo added:
[With] Macquarie Telecom, you're not going to go wrong and it's got lots of value left on the table. We think it's worth somewhere between $80 and a hundred bucks, even in a higher interest rate environment.
Macquarie Telecom bounced from a 3-month low of $56.37 on 26 May in a relief rally that extended to $64.40 per share.
Prices have levelled off but Rollo appears to be a buyer at these levels keeping a long term, fundamental framework in mind.
Despite the volatility this year, the Macquarie Telecom share price has clipped a 27% gain in the past 12 months.
