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LoopNet is scheduled to
report Q208 results after the market closes on July 30. Based on
our analysis, we at
eChristianInvesting are expecting LOOP to report
disappointing results that fail to meet Wall Street’s consensus
expectations.
Analyst
Expectations
We are
forecasting revenues of $20.8M versus analyst consensus of
$21.8M. This would represent a 22% increase in revenues from
last year’s $17.0M in the same period, but would be essentially
flat with the previous quarter.
Our checks
show a decline in both traffic and listings at the LoopNet.com
website. In addition, there appears to have been a drop in the
listings at BizBuySell.com, which while it represents only a
small portion of LOOP’s revenues is indicative of the declining
market environment in which they operate.
Share
Performance
To date,
LoopNet’s shares have
dropped over 25%. Meanwhile, the NASDAQ has only fallen 16%.
This big drop is primarily a result of the markets disfavor of
all real estate related stocks despite the fact that LOOP
focuses on the much more stable commercial real estate sector.
Valuation
Shares are
now trading at 18x consensus 2009 EPS estimates. This is
essentially inline with their peer group. With the potential for
disappointing quarterly results and the continued bleak outlook
for the real estate sector we would not recommend holding LOOP
shares in the current market. However, once consumer sentiment
starts to improve, we believe that LoopNet will benefit from
their leadership position in the online commercial real estate
space.
At the time this article was published, the author did not have
a financial position in any of the stocks mentioned in this
article.
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