Posts Tagged ‘technology’

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Buzz Stock of the Day – Smith and Wesson (SWHC)

Friday, June 19th, 2009

Shares of Smith and Wesson Holding Corp. (Nasdaq: SWHC) ended the day 22 percent higher on eight-times the gunsmith’s average three-month volume after the company announced $99.5 million in fourth-quarter revenue. The 20 percent boost over the same period last year was above analysts’ forecast of $90.8 million, according to Thomson Reuters.

“Demand for our handguns and tactical rifles remained strong throughout the fourth quarter, as evidenced by our revenue as well as by our backlog balance,” the company said in a statement.

The company is also adding a new stream of revenue to its arsenal. On Thursday, Smith and Wesson Holding Corp. announced a deal to acquire Universal Safety Response, a privately held maker of barriers, gates and other perimeter security related equipment, for $52.5 million in cash and stock.

In a recent news release, Smith and Wesson stated that the deal should bring in revenue of $100 million next year and generate EBITDA of $15 million.

According to a recent report by the Dow Jones Newswires, first-time gun buyers, it’s been said, have rushed to buy firearms ahead of the new administration’s assumed tougher stance on gun-control laws.

The company will release full results for the quarter on June 22, after the market closes. Analysts are looking for earnings per share of 9 cents.

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Buzz Stock of the Day – Atlantic Tele-Network (ATNI)

Wednesday, June 10th, 2009

Shares of Atlantic Tele-Network, Inc. (Nasdaq: ATNI) were up as much as 47 percent at mid-day trading today, after the Salem-based telecommunications service provider announced a definitive agreement to acquire $200 million in certain wireless assets from Verizon Wireless.

Atlantic Tele-Network will acquire wireless properties, including wireless spectrum licenses and network assets, serving over 800,000 subscribers primarily in rural areas across Georgia, North Carolina, South Carolina, Illinois, Ohio, and Idaho. Verizon Wireless is required to divest these properties as part of the regulatory approvals granted for its purchase of Alltel earlier this year.

[–quote–]
As of April 30, 2009, Atlantic Tele-Network had approximately $90 million in cash and cash equivalents, $75 million of available borrowings under its undrawn revolving credit facility, and an additional $50 million of borrowing capacity, subject to lender consent, under its term credit facility.

Atlantic Tele-Network expects the transaction to close by Q3 or Q4 of this year.

According to CEO, Michael Prior, the acquisition provides the company with “enhanced scale and revenue diversification,” and expand its U.S. wireless business. “Coupled with our existing U.S. wireless operations, we will now have significant wireless operations in rural areas of more than 10 states. Including our international operations, we expect to have more than 1,000,000 retail wireless subscribers by transaction close.”

We like ATN because the company is relsilient, generates cash from operations, and has healthy earnings growth. Shares of ATNI are down about 8.4% in the past 52-weeks, compared to Verizon’s 21.5% drop, AT&T’s 34.9% drop and Sprint’s 42.3% drop over teh past year.

ATNI generated about $65.8 million in operating cash flow and$24.1 million of levered free cash flow in the trailing 12-month period.

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Buzz Stock of the Day – InfoSonics (IFON)

Friday, May 15th, 2009

Shares of our Buzz Stock of the Day – InfoSonics Corp. (Nasdaq: IFON) — were up as much as 95 percent today on heavy volume after the wireless handset provider announced strong first quarter earnings.

The company, which serves the Latin American wireless handset and accessories market, announced first quarter earnings of $247,000 or $0.02 per share, compared to a net loss of $413,000 or $0.03 per share in the same quarter of last year. Revenues for the quarter declined to $42.6 million, compared to $67.9 million in the first quarter of 2008. However, net sales increased sequentially by $9.2 million.

Operating expenses decreased were $2.9 million, a decrease of 22% when compared to operating expenses of $3.7 million in the first quarter of 2008, and a decrease of 23% when compared to operating expenses of $3.8 million in the fourth quarter of 2008.

“While we are very encouraged by the improvement in our results over last quarter, we continue to focus on increasing our revenues and gross margins,” said InfoSonics’ president and CEO, Joseph Ram. “In addition we took steps during the quarter to realign our cost structure with our current revenue level. We remain focused on profitability and are working with our vendors; both OEM and proprietary, to better manage our inventory levels and overall expenses.”

We like IFON because the company has a strong balance sheet, generates cash from operations, and is taking the right steps to maintain profitability. The sizable decrease in operating expenses coupled with the company’s ability to generate profit despite a drop in sales makes us bullish on InfoSonics’ future. Last year, the company generated approximately $17 million of operating cash flow on revenue of $213 million. InfoSonics has about $24 million of cash in the bank, and is trading at a lower multiple than many of its competitors.

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Buzz Stock of the Day – D&E Communications (DECC)

Monday, May 11th, 2009

Shares of our Buzz Stock of the Day — D&E Communications (Nasdaq: DECC) — were up more than 52 percent in mid-day trading on the Nasdaq today after news broke that the company would be acquired by U.S. local telephone company Windstream Corp. (NYSE: WIN) for about $330 million.

As part of the deal, D&E shareholders will receive 0.650 shares of Windstream stock and $5 in cash for each share held, Windstream said in a statement.


Based on Windstream stock’s Friday closing price, the deal values D&E Communications at $10.88 per share, a premium of about 61 percent to its Friday closing of $6.75, D&E Communications said in a separate statement.

Pennsylvania-based D&E Communications provides services including high-speed Internet, local and long distance telephone, video and professional IT services.

The acquisiton is expected to close in the second half of 2009 and add free cash flow in the first full year and reduce dividend payout ratio, according to Windstream.

“This merger combines best-in-class products and services of two great integrated communications providers,” said D&E’s president and CEO, James Morozzi The result ensures a strong and vibrant company that is well-positioned to serve our customers, shareholders and employees today as well as in the future.”

According to Windstream president and CEO, Jeff Gardner, the D&E’s reach will help Windstream “significantly expand” its operations in Pennsylvania and “provide the opportunity to grow cash flow, reduce our dividend payout ratio and create value for shareholders and customers.”

Shares of Windstream were down 2.6 percent at mid-day trading on the New York Stock Exchange.

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Buzz Stock of the Day – Endwave (ENWV)

Thursday, April 30th, 2009

Earlier today, Microsemi Corp. (Nasdaq: MSCC) announced that it acquired a defense electronics and security business from our Buzz Stock of the Day — Endwave Corp. (Nasdaq: ENWV) — for $28 million in cash and the assumption of specified liabilities.

Endwave’s D&S group has developed many innovative, state of the art products and has won several contracts to supply these products on major systems projects with many current Microsemi customers such as Boeing, Cobham, L3, Lockheed Martin, Northrop Grumman, and Raytheon.

Shares of Endwave were up as much as 51 percent today on the news.

Later today, Endwave announced results for the first quarter.

Revenues were $12.0 million for the first quarter of 2009, compared with $14.2 million for the first quarter of 2008 and $9.8 million for the fourth quarter of 2008. Net loss, calculated in accordance with accounting principles generally accepted in the United States (GAAP), for the first quarter of 2009 was $3.7 million, or $0.39 per share, compared with net loss for the first quarter of 2008 of $1.9 million, or $0.21 per share, and net loss for the fourth quarter of 2008 of $11.1 million, or $1.19 per share.Non-GAAP net loss for the first quarter of 2009 was $1.6 million, or $0.17 per share, compared with non-GAAP net loss for the first quarter of 2008 of $603,000, or $0.07 per share, and non-GAAP net loss for the fourth quarter of 2008 of $3.0 million, or $0.32 per share.

“We reported two very positive events today,” said Ed Keible, Endwave’s CEO and President. “First, we were pleased to see our overall revenues expand, compared to Q4 2008, driven primarily by demand from our key telecom customer. Second, Microsemi Corporation acquired the assets of our non-telecom products business. The decision to divest our non-telecom operations was a difficult decision for us, as we believe that this business has great promise. However, Microsemi has the scale and funding needed to take this business to the next level, the price offered by Microsemi was one we determined to be in the best interests of our stockholders, and we believe this transaction may help clear the way for other strategic alternatives that may be available for our communication products business.”

Endwave, together with its subsidiaries, engages in the design, manufacture, and marketing of radio frequency (RF) modules that enable the transmission, reception, and processing of high frequency signals in telecommunication networks, defense electronics, homeland security systems, electronic instrumentation, and other applications that require high frequency RF circuitry and subsystems.

For the trailing-12-month period, Endwave earned $6.32 per share on revenue of $58.2 million. The company has about $40 million of cash in the bank, and a small float (9.12 million shares).

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