Daktronics (NASDAQ: DAKT) is a major supplier of large screen video displays and related control systems. Products include scoreboards and animation displays for sports facilities; advertising displays for businesses; electronic information displays for motorists; and real-time data displays for securities traders. The firm also offers large scale sound and rigging systems for entertainment and sports venues.
The firm surprised the Street last week, when it reported fiscal Q4 EPS of 14 cents and revenues of $129.1 million. Analysts had been expecting six cents and $123.3 million. Management also guided FY09 revenues to points above $599.6 million ($587.91M consensus). The CEO noted development of strong international orders and a strong overall backlog.
DAKT shares popped on the news and have since been consolidating the move in a bullish "flag" consolidation pattern. Prices frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.
Brokers recommend the issue with two "strong buys" and five "buys". Analysts see a 33% growth rate, through the next year. The DAKT Sales Growth rate (16.54%), EPS Growth rate (55.55%), Return on Assets (9.36%) and Return on Investment (14.81%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 57% of the outstanding shares. The stock is one of those used to calculate the S&P 600 SmallCap Index. Over the past 52 weeks, it has traded between $13.88 and $32.37. A stop-loss of $16.85 looks good here.