Wells Fargo Upgrades Stanley, Inc. (SXE) to Outperform; Raises Valuation Range & EPS Estimates

October 30, 2009 7:44 AM EDT

Wells Fargo upgrades Stanley, Inc. (NYSE: SXE) from Market Perform to Outperform. Valuation range increased from $29-31 to $32-34.

Wells analyst says, "Despite intraquarter concerns around the pace of new business, Stanley easily beat topand bottom-line expectations. Revenue was $217 million and EPS $0.49. Our estimates were $208 million and $0.41, respectively. Although book-to-bill was 0.8x, it was much better than expected, and FQ3 has gotten off to a very strong start with a majority of the work being "new." Upside came from better contract performance and more so SG&A leverage. We are raising our FY10 EPS estimate to $1.88 from $1.71 and our FY11 EPS to $2.05 from $1.92, and believe these estimates remain conservative.

"Client decision delays on awards around Army Reset activities - a key focus area of growth - among other factors have created a period of sub-targeted (10-15%) organic growth that we now see ending in F2Q11 (Sept.). Award activity has now picked up and is of the higher margin nature."

To see more analyst ratings on SXE Click Here.

Related Categories

Upgrades

Stocks Mentioned

Add Your Comment

Name

Subject

Body

Verification can't see the text?
click here to refresh the image.
what's this?