The earnings run rate is now on a $.40+ level with expectations for at least 24% revenue growth next year. Analyst still report earnings on a GAAP basis which is bizarre for a small tech company. Since the average analyst expects GAAP eps to grow by $.30 in 2010, we feel comfortable that adjusted net income could easily top $.70 on a conservative basis. Slap at least a 20 PE on that estimate and the stock zooms to $14 from the current high $5s.
- The company now expects total revenue for the fourth quarter to be between $16.2 and $16.6 million, which at the midpoint would represent an 8% sequential increase over the third quarter of 2009. The company expects net income (loss) for the fourth quarter of 2009 to be between ($100,000) and $150,000 or between ($0.01) and $0.01 per diluted share, and to include the following items:
- Excluding the above items from net income, fourth quarter Adjusted Net Income is now expected to be between $1.5 million and $1.8 million or between $0.10 and $0.12 per diluted share.
- The company expects fourth quarter 2009 revenue to be between $15.3 and $15.6 million, which at the midpoint would represent a 2% sequential increase over the third quarter of 2009. The company expects net loss for the fourth quarter of 2009 to be between $100,000 and $0 or between ($0.01) and $0.00 per share, and to include the following items:
- Excluding the above items from net income, Adjusted Net Income is expected to be between $1.4 million and $1.5 million or between $0.09 and $0.10 per diluted share for the fourth quarter of 2009.
LOCM has now made a habit of over delivering on promises which is something that should really begin catching on with the investing community. They were always long on potential with an attractive website name in local.com and short on results but that has apparently changed during the worst economy in 70 years. 47% growth rates are unheard of these days and soon LOCM will be discovered. Trading at about 13x its run rate earnings seems incredibly cheap.