Wells Fargo Downgrades NCI, Inc. (NCIT) to Underperform; Surprise Sharp Drop In CY12 Outlook - Positioning Now In Question
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Price: $20.00 --0%
Rating Summary:
2 Buy, 6 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
2 Buy, 6 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Wells Fargo downgraded NCI, Inc. (NASDAQ: NCIT) to Underperform. Valuation Range: $5-$6 from $10-$11.
Wells analyst says, "NCIT, after the close (1/19), announced a Q4 charge to reduce space and overhead personnel as they now expect a dramatic drop-off in CY2012 revenue as re-competes have gone against them, clients have reduced the spend rate on existing work, and the general pace of new opportunities has diminished across the U.S. federal sector. It appears that NCIT's historic "value" pricing for IT work is being under-cut by competitors, especially small businesses that have preferential bidding status."
"We are LOWERING OUR 2012 REVENUE ESTIMATE to $340MM, which is the low-end of the new guidance of $340-360MM. Our/Street prior revenue estimates were $530MM/$515MM. 2011E EPS go to $0.96 from $1.09 on charge...As an initial cut, we are REDUCING OUR CY2012E EPS to $0.25 from $1.00, and we expect limited clarity/comfort in the CY2012 EPS outlook for at least several quarters..."
For an analyst ratings summary and ratings history on NCI, Inc. click here. For more ratings news on NCI, Inc. click here.
Shares of NCI, Inc. closed at $11.46 yesterday.
Wells analyst says, "NCIT, after the close (1/19), announced a Q4 charge to reduce space and overhead personnel as they now expect a dramatic drop-off in CY2012 revenue as re-competes have gone against them, clients have reduced the spend rate on existing work, and the general pace of new opportunities has diminished across the U.S. federal sector. It appears that NCIT's historic "value" pricing for IT work is being under-cut by competitors, especially small businesses that have preferential bidding status."
"We are LOWERING OUR 2012 REVENUE ESTIMATE to $340MM, which is the low-end of the new guidance of $340-360MM. Our/Street prior revenue estimates were $530MM/$515MM. 2011E EPS go to $0.96 from $1.09 on charge...As an initial cut, we are REDUCING OUR CY2012E EPS to $0.25 from $1.00, and we expect limited clarity/comfort in the CY2012 EPS outlook for at least several quarters..."
For an analyst ratings summary and ratings history on NCI, Inc. click here. For more ratings news on NCI, Inc. click here.
Shares of NCI, Inc. closed at $11.46 yesterday.
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