Deutsche Bank upgraded Invitrogen (IVGN) to buy from hold.
Analyst Cheri Walker says the new COO/president and the new CFO of the medical research products company gave a solid business review with a reasonable cost structure that accelerates earnings above revenue growth. Walker says management is committed to maintaining operating margins of 23%-24%, rather than the contraction indicated in its third quarter conference call. She notes the company sees $2.05 2003 earnings per share, at the high end of her expectations, and 12% revenue growth to $728 million.
Walker raised her $161.4 million fourth quarter revenue estimate to $162.4 million to account for a contribution from recently acquired Informax; she also cut her 45 cents fourth quarter earnings per share estimate to 41 cents due to additional costs. Finally, she lifted her $1.99 2003 earnings per share estimate to $2.02 and raised her $33 target to $35.