IPH (ASX: $IPH) is a downtrodden growth stock but after the Canadian acquisition of B&P it will be the largest player in Canada and in a really strong market position to bring earnings growth.

Intellectual property may not be the flashiest industry, but IPH has been making steady moves behind the scenes, strategically constructing an IP empire that spans important developed markets.

IPH can be thought of as a stable, cash-generating business with solid organic EPS growth and a ~7% dividend yield.

With a steady stream of acquisitions and a growing presence in emerging sectors like AI and silicon chips, IPH is positioning itself as a global heavyweight in trademarks and patents outside of the US.

Despite underperforming against the broader ASX market, the company’s long-term prospects remain solid, offering stable, cash-generating growth for investors. Here’s why IPH’s valuation is compelling and a focus on organic growth with it’s Canadian acquisition shouldn’t be overlooked.

Progressive Developments in the Bridging Study

In a move that solidified its dominance, IPH recently acquired Canadian firm Bereskin & Parr (B&P), extending its market reach beyond Australia and New Zealand into North America. This acquisition is not just another notch in IPH’s belt but a strategic decision that positions the company as the largest player in trademarks across three significant markets: Australia, New Zealand, and now Canada.

Canadian market share reaches ~35%, roughly level reached in Australia and New Zealand to be the market leaders now in 3 countries. This was funded with a equity raising and that notionally reduced debt levels to 1.7x FY24 proforma Net Debt/EBITDA. This in the short term depresses the share price as new equity is adsorbed in the market, it opens the opportunity to pursue more M&A as management has previously flagged.