Motorola Solutions (MSI, Financial) reported +7% revenue growth, driven by software and services growth of +12% along with continued margin expansion. Recall that Motorola Solutions’ primary business is providing specialized communication infrastructure, equipment and software to public safety, law enforcement, and increasingly to large corporations. Motorola’s backlog of sales to these customers, which we typically use as a reasonable proxy for future revenue growth, was up +17% overall and up +26% in the higher margin software and services segment. As such, we continue to believe Motorola Solutions has room to accelerate top and bottom-line growth, while the stock continues to exhibit an undemanding, market multiple– rare, in our view, whereby almost any company these days exhibiting double-digit growth commands rich multiples.
From David Rolfe (Trades, Portfolio)'s Wedgewood Funds fourth-quarter 2019 shareholder letter.
