Needham & Company Reiterates a 'Buy' on Virtusa (VRTU); CFO Meeting: Industry Drivers In Place, Business On Track; Risk-Reward Compelling
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Price: $51.33 --0%
Rating Summary:
6 Buy, 8 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
6 Buy, 8 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Needham & Company reiterates a 'Buy' on Virtusa (NASDAQ: VRTU) price target of $25.00.
Needham analyst says, "We hosted VRTU’s CFO, Ranjan Kalia, for meetings with institutional investors. Key takeaways included VRTU’s business remains on track, clients continue to leverage low cost offshore IT resources to reduce costs and increase efficiencies, and VRTU’s pipeline continues to expand, with no change in customer buying patterns. We believe VRTU's differentiated capabilities, especially versus its small and medium sized peers, positions it to grow at or above industry levels. At the same time, we believe VRTU can continue to drive 100-150 bps of margin expansion annually by leveraging G&A and “flattening” out the employee pyramid. Bottom-line, we see potential for VRTU to deliver 30%+ EPS growth over a multi-year period through 20%+ organic top-line growth and 100-150 bps margin expansion. At just 11x ex-cash CY12 EPS power, we believe the risk-reward is compelling and reiterate our rating."
For more ratings news on Virtusa click here and for the rating history of Virtusa click here.
Shares of Virtusa closed at $14.85 yesterday.
Needham analyst says, "We hosted VRTU’s CFO, Ranjan Kalia, for meetings with institutional investors. Key takeaways included VRTU’s business remains on track, clients continue to leverage low cost offshore IT resources to reduce costs and increase efficiencies, and VRTU’s pipeline continues to expand, with no change in customer buying patterns. We believe VRTU's differentiated capabilities, especially versus its small and medium sized peers, positions it to grow at or above industry levels. At the same time, we believe VRTU can continue to drive 100-150 bps of margin expansion annually by leveraging G&A and “flattening” out the employee pyramid. Bottom-line, we see potential for VRTU to deliver 30%+ EPS growth over a multi-year period through 20%+ organic top-line growth and 100-150 bps margin expansion. At just 11x ex-cash CY12 EPS power, we believe the risk-reward is compelling and reiterate our rating."
For more ratings news on Virtusa click here and for the rating history of Virtusa click here.
Shares of Virtusa closed at $14.85 yesterday.
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