Descartes Continues to Deliver Solid Results; FVE Steady at $69

Descartes produced solid second-quarter results, with revenue and adjusted EBITDA slightly ahead of our expectations. Management noted the demand environment was good and that shipping volumes are healthy even if shipping rates have begun to ease. We are maintaining our fair value estimate for narrow-moat Descartes at $69 (CAD 91) per share and see shares as fairly valued. We see supply chain conditions persisting throughout the rest of the year given the conflict in Ukraine and easing of China lockdowns, which may help near-term results, but do not affect our long-term forecast. We continue to view Descartes as being well-positioned to address the heightening complexity of global transportation networks, especially as the firm's portfolio expands and geopolitical issues flare up.