PIPER JAFFRAY UPS ESTIMATE, TARGET FOR PRICELINE.COM
Piper Jaffray analyst Aaron Kessler says Priceline.com (PCLN) reported another impressive quarter, with gross profit and EBITDA upside of 10% and 29%, respectively. He continues to highlight Priceline as his top eCommerce pick, given strong growth prospects driven by robust international growth, improving domestic growth, increasing operating leverage and a currently attractive valuation.
Kessler raises $3.58 2007 EPS estimate to $4.01, $4.45 2008 EPS to $5.42 and $120 target price to $141. Even with the shares rising today, he says he would continue to be an aggressive buyer, as he believes Priceline's growth and international assets remain underappreciated byinvestors. Rates outperform.
JP MORGAN UPGRADES APPLIED MATERIALS TO OVERWEIGHT FROM NEUTRAL
JP Morgan analyst Jay Deahna says he's upgrading Applied Materials (AMAT) on its recent stock pullback. He notes that, going forward, he believes the solar equipment business is likely to drive sustained above-average growth once revenue recognition begins, which he expects to start in the fourth quarter of fiscal year 2008 (October).
As such, Deahna now expects sustained above-market-average stock price appreciation for Applied Materials over the next several years, as he thinks the Street will ascribe an increasingly higher probability to the growth potential of the company's nascent but potentially explosive solar equipment business. He cuts $1.37 fiscal year 2008 EPS estimate to $1.23, mainly on solar ramp costs. He sees EPS of $1.55 for fiscal year 2009.
JP MORGAN CUTS ALLSCRIPTS HEALTHCARE SOLUTIONS TO NEUTRAL FROM OVERWEIGHT
JP Morgan analyst Atif Rahim says Allscripts Healthcare Solutions' (MDRX) lower revenue coupled with higher expenses led to a $0.04 shortfall in the third quarter vs. his $0.15 estimate. He says management cut $0.58-$0.60 2007 non-GAAP EPS guidance to $0.48-$0.49. He cuts his $0.57 2007 EPS estimate to $0.49, and $0.76 for 2008 to $0.69.
Rahim notes recent industry trends and comments by competitor QSII indicate that small to mid-size physician groups may be delaying purchase decisions, awaiting subsidized HCIT from hospitals. He views stock appreciation prospects as limited for foreseeable future given slower top-line growth projections for the company, coupled with a growing cost structure.