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New CEO: Integrated Research Limited share price pops

What happened? Integrated Research Limited (ASX: IRI) last night announced after market close that the company had succeeded in finding a new CEO to lead the company forward.

Integrated Research, which markets itself as “the leading global provider of proactive performance management software for critical IT infrastructure, payments and communications ecosystems”, had been searching for a CEO since Mr. Darc Rasmussen left the role in February. This should be viewed as a positive development as the company has been paying $66,000 per month for their interim CEO.

What does it mean? From the 17th of July, Mr. John Merakovsky will leave his position at SEEK Limited (ASX: SEK) as General Manager of Seek Learning to join Integrated Research and build on the success of the last 5 years.

Mr Merakovsky comes with 25 years of experience working in technology and digital companies and will be tasked with increasing Integrated Research’s global reach, which currently stands at over 1000 organisations from 60 countries.

Where to from here? Integrated Research has been one of the best performing and most consistent technology companies on the ASX over the last 5 years. The share price has increased by 360% while earnings per share and profit has more than doubled.

Analysts expect more of the same for this financial year (ending on June 30), as earnings per share is predicted to increase to around 11 cents (from 8.5) and dividend per share to remain steady at around 6.5 cents.

At the current price around $3 per share, this places the company on a price-to-earnings ratio of around 26 times, and a dividend yield of a little over 2%. While strong earnings growth is still expected, Integrated Research appears to be priced for very strong growth into the future. Investors may be wise, at this time where the ASX is looking a little expensive, to consider lower price-to-earnings companies like those below:

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Motley Fool contributor Andrew Mudie owns shares of Integrated Research Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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