USB Piper raised its target on Direct Focus (DFXI ) and reiterates strong buy.
Analyst Brent Rystrom says he believes the company poised to report another excellent quarter, with sales and margin trends progressing favorably relative to his estimates. He says unit sales of Bowflex appear strong, and average selling prices are rising for Bowflex. He notes the company is making signicant progress integrating its two recent purchases: Schwinn Fitness Products and Stairmaster. He sees facility consolidations, job cuts, and a combination of sales teams positioning the company for sharply accelerating sales growth starting in 2003. Rystrom also says his new $52 target, up from $42, represents a multiple of 18 times his $2.95 2003 earnings per share estimate.