Hi Cal, sorry I didn't get back sooner on CUBE. I wanted to pick through the numbers a bit first.
To start with Robertson Stepens lowering estimates (which you pointed out) for the second time in two months doesn't both me. Looking at Zacks figures, their mean estimate for next qtr is .46 It has been .46 or .47 since mid November (11/18 is the earliest I can find). So overall, ZACKS has not changed their estimate in over 3 months...higher or lower. The analysts from Robt Steph is Dan Klesken. From what I've read, he is ranked 2 out of 12 analysts for his ability to predict changes in stock price for CUBE, but only ranked 7 out of 12 for his ability to forecast CUBE's EPS. On top of that, his original forecast (before revising to $2 for fiscal '97) was $2.15 This the high estimate compared to 8 analysts for Zacks, higher than all 7 analysts for Nelsons, and just below the highest estimate from 8 analysts at I/B/E/S. His revised est to $2 comes right in line with everyone's mean est. So basically....the guy was over optimistic. Kinda like Kurlak for MU & INTC (works for Merrill).
With that said I'll now switch from analysts expectations to fundamentals. I believe the company has very sound fundamentals...
---great revenue growth
---great EPS growth
---sales & net income are both growing at a nice steady pace
---the balance sheet is managed very well (unlike many others I examine, CUBE's receivables, inventory, or liabilities aren't increasing out-of-line compared to their growth rate in other numbers).
I think the stock is undervalued, and will do very well late this year (at the very latest) after the public can see their product in action. The price is supposed to be under $500, so I don't think it will take long for sales and demand to fly. IMO, a pessimistic estimate for CUBE's price within the next year is $50. An optimistic estimate would be $75. I'm basing these estimates off of past growth/valuations and future estimates. This is just my opinion.
Feel free to make any comments.
Kevin |
