Stanley Inc. (NYSE: SXE) provides information technology services and solutions to U.S. defense and federal civilian government agencies. The firm offers systems integration solutions and expertise to support mission-essential needs at any stage of program, product development or business lifecycle. Services involve systems engineering, enterprise integration, operational logistics, business process outsourcing, and advanced engineering and technology. The company employs more than 2,800 and operates at over 100 locations worldwide.

Stanley pleased investors earlier in the month, when it announced fiscal Q1 EPS of 23 cents and revenues of $133.5 million. Analysts had been expecting 21 cents and $122.4 million. Management also guided Q2 EPS to 23-25 cents (20 cent consensus), Q2 revenues to $133-$138 million ($122.33M consensus), FY08 EPS to 90-95 cents (85 cent consensus) and FY08 revenues to $525-$540 million ($497.11M consensus). Stifel Nicolaus subsequently reiterated its "buy" recommendation. SXE shares popped on the news and then moved into a bullish "pennant" consolidation pattern. Prices frequently exit pennants moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.

Altogether, brokers now recommend the issue with eight "strong buys" and one "buy." Analysts see a 22% average annual growth rate, through the next five years. The SXE Price to Sales ratio (1.15), Price to Book ratio (3.47), Sales Growth rate (44.23%) and EPS Growth rate (53.33%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 61% of the outstanding shares. Since going public last October, the stock has traded between $13.41 and $22.84. A stop-loss of $18.50 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.