Pacific Crest upgrades Internet advertising company ValueClick Inc. (VCLK ) to outperform from sector perform.
Analyst Chad Bartley views ValueClick as a strong play on positive trends in online advertising. ValueClick has increased its organic revenue by 34% in 2004, compared with U.S. online advertising growth of roughly 25%.
In 2005, he expects ValueClick to outperform industry growth, which he estimates will be 25% to 30% in the U.S. However, Pacific Crest's proprietary surveys of media buyers indicate that growth could be much higher than expected.
Therefore, Bartley sees an upward bias to his estimates. He expects 2005 earnings per share growth to be in the mid-20% range, and accelerate to 30% in 2006.