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Technology Stocks : Hummingbird Comm. (HUMC) -- Ignore unavailable to you. Want to Upgrade?

To: John Chatterton who wrote (1794)	1/21/1999 12:05:00 AM
From: John Chatterton	Read Replies (1) \| Respond to of 2018

Hummingbird Communications Ltd. Dow Jones Newswires -- January 20, 1999 Once Again, Hummingbird Commun Up Ahead Of Earns Release By Lori McLeod TORONTO (Dow Jones)--In a pattern that's becoming familiar, Hummingbird Communications Ltd.'s (HUMCF) share price is rising in anticipation of the release of its quarterly results, analysts told Dow Jones. Hummingbird is scheduled to report earnings for the first quarter ended Dec. 31 after the market closes on Thursday. On Friday, Monday and Tuesday, the stock gained 5.90, or 19%, to 36.75. Volume averaged more than 300,000 shares a day during the three days, more than triple the average daily volume. Hummingbird's share price got a similar boost in October before the release of results for the fourth quarter ended Sept. 30. Both share-price increases resulted from the view that Hummingbird could report better-than-expected results, combined with speculation about a possible acquisition, said Michel DeLavergne, an analyst with Dlouhy Investments Inc. Hummingbird's fourth-quarter results were "in line with or slightly above" analysts' expectations, said Paul Bradley, an analyst with Canaccord Capital Corp. However, the company revised downward its fiscal 1999 projections at that time, causing its share price to drop. Hummingbird announced its last major acquisition, of Andyne Computing Ltd., in October 1997, right around the time it reported its fourth-quarter results. Since then, there has been speculation Hummingbird will announce its next acquisition in conjunction with quarterly results, Bradley said. However, Bradley said there's no reason to believe news of an acquisition will accompany Hummingbird's first-quarter earnings announcement, although Hummingbird has been talking about making another acquisition for months. DeLavergne said he expects Hummingbird to make an acquisition in the "not-too-distant future," but added it could happen "next year or next week." An acquisition would add to the market's confidence about Hummingbird's growth, Bradley noted. Larry Rudolf, Hummingbird's senior director of corporate communications, said making an acquisition on the business-intelligence side of its business is still a "number one priority" for Hummingbird, but that nothing is imminent. He said the company has about $140 million of cash on hand. Companies that compete with Hummingbird Communications Ltd.'s (HUMCF) business-intelligence-software business have been reporting very strong revenue growth lately, analyst Paul Bradley of Canaccord Capital Corp. noted. Cognos Inc. (COGNF), Brio Technology Inc. (BRYO), and Business Objects S.A. (BOBJY) have reported year-over-year revenue growth ranging from almost 25% to more than 70% in their latest quarters, Bradley said. Hummingbird's Rudolf said the company's intent is that revenues from this sector in fiscal 1999 will be roughly double the fiscal 1998 level. The year-earlier revenue from this group isn't available because Hummingbird hasn't provided revenue figures by business group. That side of Hummingbird's business is seen as the key to its growth as sales of its core connectivity software flatten out, Bradley noted. In fact, the market would probably be "forgiving" if Hummingbird's first-quarter earnings fell slightly short of expectations as long as the company showed "excellent" revenue growth from business-intelligence-software sales, Bradley said. Both Bradley and analyst Michel DeLavergne of Dlouhy Investments Inc. said they expect Hummingbird's first-quarter earnings to be in line with expectations. Both said they have maintained their fiscal 1999 earnings estimates since Hummingbird's downward earnings revision in October. Bradley said he's expecting Hummingbird to report net of 42 cents a share in its first quarter, while DeLavergne is expecting net of about 40 cents. The First Call mean earnings estimate is 38 cents. The First Call number was lowered from 42 cents on Jan. 13, but neither analyst could explain the change. A company spokesman also couldn't explain the revision. He added that Hummingbird's outlook for revenues of $150 million and net of $1.70 a share in fiscal 1999 are still "absolutely our objectives." Analyst Paul Bradley of Canaccord Capital Corp. said he's maintaining his "buy" recommendation on Hummingbird Communications Ltd. (HUMCF). He said he raised his rating from 'hold" in December because he thought Hummingbird was undervalued. Bradley said he's expecting net of about $1.70 a share and revenues of about $150 million for Hummingbird in fiscal 1999, in line with the company's projections. Analyst Michel DeLavergne of Dlouhy Investments Inc. said his estimates for fiscal 1999 are net of about $1.65 a share and revenues of about $140 million. DeLavergne said he's been "more conservative" than Hummingbird about growth in its core connectivity-software business. He said he expects no growth in this sector in fiscal 1999, in contrast to the company's forecast of 5% growth. A company spokesman said growth in this side of its business is slowing, but isn't expected to be flat in fiscal 1999. DeLavergne said he has an "accumulate" recommendation on Hummingbird, which he said he will raise when he sees a "clear signal" that its business-intelligence-software revenue growth is on track. -By Lori McLeod; 416-943-7800