05 ET ******
AVID TECHNOLOGY INC (AVID) 30 3/8 +3 3/4. Wall
Street is going nuts over the company's latest earnings
reports. As well they should, after the company reported
2nd qtr earnings that exceeded the First Call
estimate by 16 cents, or 146%. For the quarter, the
developer of digital audio and video tools earned $6.47
million, or $0.27 a share, reversing a year-ago loss of
$3.7 million, or $0.17 a share. The turnaround came on
only a 12.6% improvement in revenues to $122.9 million
and was primarily a result of improved operating margins
and lower expenses. With expenses under control and with
the company planning less-aggressive product pricing,
analysts are expecting robust growth for the remainder of
the year, as well as next year. After viewing the
financials, Prudential Securities doubled its FY97
estimate to $1.00 a share and increased its FY98
view to $1.45 a share from $1.00. The firm also
raised its investment rating on issue to "buy" from
"hold." Robertson Stephens is also raising estimates.
The firm increased its FY97 view to $0.95 from $0.72 and
its FY98 estimate to $1.30 from $1.25 a share. Based on
the revised Prudential fiscal 1998 estimate and the new
Roby Stephens view, the stock carries multiples of 21
and 23, while near-term annual earnings growth is
indicated in the 37%-45% range. |
