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Notes From a Cyber Trader___________________________________________________________________________________________________________________________________________Earnings revisions Part II: Tech stocks
The Globe and Mail
May 27, 2009
Steve Ladurantaye
WHAT ARE WE LOOKING FOR?
Canadian technology companies that have had earnings revisions for the next quarter, within in the last couple of months. We’ll then check how the revisions have (or have not) affected stock prices.
TODAY’S SEARCH
Using StarMine Professional, we looked at technology stocks on the Toronto Stock Exchange and earnings estimates for the 46 stocks of all market cap sizes in the sector. StarMine is a service that tracks earnings estimate trends.
We looked at price changes in percentage terms and how much analysts in the last 30 and 60 days have increased or decreased profit predictions in percentage terms. We looked at analyst predictions for next quarter’s earnings, the next 12 months earnings and the next 24 months earnings.
WHAT DID WE FIND?
We’ll take the big view first – the 46 stocks have seen their earnings revised an average 1.2 per cent higher in the last two months, and their stock prices have advanced a whopping 36.6 per cent. The gains certainly haven’t been based on how the companies have performed in the last four quarters, with profits down 55.4 per cent and revenues off 0.7 per cent.
Aastra Technologies Ltd. is clearly the top pick of its analysts – while other companies have seen their shares appreciate at a quicker clip over the last two months, none have seen their analysts revise their forecasts for the next quarter so sharply – up 72.9 per cent.
In the same time, its shares have shot ahead by 44.2 per cent. The Concord, Ont.-based communications company has seen its profit improve by 168.9 per cent in the last four quarters, while revenue has increased by 56.6 per cent in the same amount of time.
Sierra Wireless holds up the sector’s back end, with analysts revising estimates for the next quarter 60 per cent lower. In the same time period, however, its shares have surged 46.7 per cent higher.
S&P/TSX tech stocks earnings momentum check .
| Company | Ticker | Price chg % last 30 days | Price chg % last 60 days | Next quarter's EPS % chg over last 30 days | Next quarter's EPS % chg over last 60 days | Next 12 month's EPS % chg over last 30 days | Next 12 month's EPS % chg over last 60 days | Next 24 month's EPS % chg over last 30 days | Next 24 month's EPS % chg over last 60 days | Net income % chg over past 4 quarters | Revenue % chg over past 4 quarters |
| Aastra Tech | AAH-T | -6.0 | 44.2 | 1.8 | 72.9 | 2.5 | 115.4 | -- | -- | 168.9 | 56.6 |
| Mellanox Tech | MLNX-T | 14.1 | 28.0 | 1.1 | 37.9 | 1.8 | 26.6 | -- | -- | -- | -- |
| Kaboose Inc | KAB-T | 3.4 | 64.9 | -- | 20.0 | 8.0 | 1.1 | -- | -2.1 | -29.7 | 2.8 |
| Dragonwave Inc | DWI-T | 39.2 | 82.1 | 15.0 | 20.0 | -- | 111.1 | -- | -- | 4.4 | 9.6 |
| Points Int'l | PTS-T | 4.3 | 6.7 | 12.0 | 12.0 | 4.1 | 4.1 | -4.1 | -4.1 | -237.4 | 32.5 |
| Enablence Tech | ENA-T | 100.0 | 78.9 | 0.0 | 10.0 | 5.0 | 2.5 | 0.0 | 0.0 | -1,771.7 | 5,566.7 |
| Sandvine Corp | SVC-T | 9.5 | 97.1 | 0.0 | 7.6 | 5.9 | 34.5 | 2.9 | -- | 31.3 | 124.1 |
| Webtech Wireless | WEW-T | 57.4 | 112.0 | 6.7 | 6.7 | 7.7 | 7.7 | -- | -- | 105.9 | 10.1 |
| Absolute Software | ABT-T | 0.0 | 29.8 | 5.0 | 5.0 | 24.9 | 24.9 | 58.9 | 58.9 | 16.2 | 34.9 |
| 5N Plus Inc | VNP-T | 14.9 | 9.1 | 0.0 | 4.0 | 0.4 | 1.0 | -- | -- | 125.0 | 129.1 |
| Research In Motion | RIM-T | -1.9 | 47.5 | 2.5 | 3.2 | 3.2 | 6.9 | 0.8 | -- | 25.6 | 83.9 |
| Mosaid Tech | MSD-T | 3.2 | 8.7 | -0.2 | 2.4 | -3.6 | -2.3 | 0.0 | 0.0 | 287.8 | 29.0 |
| Evertz Tech | ET-T | 13.5 | 19.5 | 0.0 | 0.2 | 0.5 | 0.6 | 0.0 | 2.8 | 14.2 | 23.6 |
| Com Dev Int'l | CDV-T | -16.0 | -1.5 | 0.0 | 0.0 | 0.0 | -1.3 | 0.0 | -- | 223.7 | 25.9 |
| Enghouse Sys | ESL-T | 47.1 | 54.8 | 0.0 | 0.0 | 0.0 | 0.0 | -- | -- | 3.0 | 67.8 |
| MKS Inc | MKX-T | 6.7 | 25.5 | 0.0 | 0.0 | 0.0 | 0.0 | -- | -- | 143.1 | 3.2 |
| Tundra Semi. | TUN-T | 12.9 | 40.2 | 0.0 | 0.0 | 0.0 | 0.3 | 0.0 | 0.0 | 97.9 | -0.6 |
| Wi-LAN Inc | WIN-T | 12.3 | 11.6 | 0.0 | 0.0 | -2.6 | -2.6 | -0.6 | -- | -100.3 | 33.3 |
| March Networks | MN-T | -7.0 | 11.4 | 0.0 | 0.0 | 0.0 | -35.8 | -- | -- | 59.3 | 11.8 |
| CGI Group Inc | GIB.A-T | -6.4 | -3.4 | -0.5 | -0.6 | -0.2 | -0.3 | 0.3 | 0.3 | 12.7 | 1.9 |
| Open Text Corporation | OTC-T | -14.5 | -16.4 | -1.5 | -1.5 | -1.6 | 0.8 | 10.2 | 10.4 | 203.2 | 7.4 |
| MacDonald Dettwiler | MDA-T | 1.3 | 9.7 | -0.2 | -2.1 | 0.7 | 1.0 | 2.3 | -- | -6.4 | -6.4 |
| Constellation Software | CSU-T | -2.5 | 10.7 | -3.4 | -2.8 | -2.1 | -2.0 | -- | -- | -12.7 | 32.1 |
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| SOURCE: STARMINE |
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