Axsys Technologies (NASDAQ: AXYS) designs
and develops high performance surveillance cameras, imaging systems and related motion control technologies, serving the aerospace, defense, and high-performance commercial markets. Applications include airborne thermal targeting, missile tracking, space-borne surveillance and semiconductor micro-inspection. The Department of Defense, Boeing (NYSE: BA) and Intel (NASDAQ: INTC) are among the firm's major customers.
The company surprised the Street last week, when it reported Q4 EPS of 36 cents and revenues of $47.9 million. Analysts had been looking for 33 cents and $45.7 million. Management also guided FY08 EPS to $1.70-$1.75 ($1.63 consensus) and FY08 revenues to $208-$212 million ($198.96M consensus). Stifel Nicolaus subsequently reiterated its "buy" recommendation and boosted its price target to $54.
The AXYS share
price popped above moving average support on the news and has since been defining a bullish "flag" consolidation pattern. Stocks frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.
Altogether, brokers now recommend the issue with one "strong buy" and three "holds". Analysts see a 22% growth rate, through the next year. The AXYS Price to Book ratio (3.23), Sales Growth rate (41.92%) and EPS Growth rate (66.34%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 64% of the outstanding shares. Over the past 52 weeks, the stock has traded between $15.71 and $48.18. A stop-loss of $38.90 looks good here.
Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold positions in any of the stocks mentioned above.
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