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Vista
Print is scheduled to report their fiscal second quarter 2009
results after the market closes on Tuesday, January 27. Based on
our analysis, we are expecting VPRT to report better than
expected results that beat Wall Street’s expectations.
Analyst
Expectations
We are
forecasting revenues of $129.1 million and EPS of $.40. This
would represent a 23% increase in revenues from last year’s
$105.0 million in the same period. The current analyst consensus
calls for revenues of $127.8 million and $.39 EPS. On the last
earnings call, the company gave quarterly guidance for revenues
of $122 – 134 million and EPS of $.36 - .41.
We are
expecting Vista Print to report solid quarterly results after
management commented in December that results were performing
well against their guidance estimates. This would indicate
impressive results in the face of extremely difficult economic
conditions and falling consumer demand.
More
importantly than the fiscal second quarter results will be if
the company can maintain full year guidance or not. Our guess is
that they will reduce fiscal year 2009 guidance in anticipation
of further weakness in the economic environment along with the
appreciating U.S. dollar.
Share
Performance
Vista
Print's shares have fallen 12% since the beginning of the year.
And in 2008, the shares fell an incredible 57% badly
underperforming the Dow Jones index’s 34% decline.
Valuation
Shares are
now trading at 10x consensus FY2010 EPS estimates. This is a
discount to the relative valuations of their peer group. If the
company is able to maintain their full year guidance, then the
shares should get a boost since they are already trading at very
attractive levels.
Recommendation:
Buy with a $20 price target.
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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