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The global technology and industrial recovery has been strong the last few quarters. Newport Corporation (NEWP - Snapshot Report) recently reported record 4th quarter sales as all of its end markets saw strong demand. Even with shares surging, the stock is cheap, trading at just 12.9x forward estimates.

Newport supplies advanced technology products and solutions, especially in the areas of lasers, photonics instrumentation, vibration isolation, optical components and subsystems and precision automation. Its Spectra-Physics Lasers Division provides a broad portfolio of laser technology products to OEM and end-user customers.

It serves customers in 70 countries and has 11 manufacturing facilities in the United States, China, France, Germany and the United Kingdom.

Sales Jumped 31% in the Fourth Quarter

On Feb 2, Newport reported fourth quarter results and surprised on the Zacks Consensus Estimate by 14.3%. It was the 7th consecutive earnings surprise.

Earnings per share were 40 cents compared to the Zacks Consensus of 35 cents. It had zero earnings in the same quarter a year ago.

Sales were a record $132.9 million up from $101.6 million in the fourth quarter of 2009. New orders also soared 20.4% to a new record of $130.4 million.

All of Newport's end markets saw increases in sales and new orders. The quarter was boosted by significantly higher orders from and sales to semiconductor equipment customers. Orders in the fourth quarter also rose from the third quarter of 2010 on increases from customers in the Scientific Research and Industrial Manufacturing segment.

Outlook for the First Quarter 2011

The company expects momentum to continue in 2011. Sales in the first quarter is projected to rise 15% to $107.2 million from the first quarter of 2010.

Earnings per share are expected to be double the year ago's 14 cents, or 28 cents per share.

Zacks Consensus Estimates Rise

Given the bullish outlook, it's not surprising that estimates have surged. 6 estimates have risen for 2011 in the last week as the Zacks Consensus Estimate has risen to $1.33 from $1.26 per share.

This is earnings growth of 21.6%.

Estimates have also risen for 2012, with 3 estimates rising in the last week, pushing the Zacks Consensus Estimate up 3 cents to $1.36 per share.

Value Credentials

In addition to its attractive P/E ratio, Newport also has a price-to-book of just 2.1, which is well within the value parameters of under 3.0.

The company also has a solid return on equity (ROE) of 15.1%.

Newport is a Zacks #1 Rank (strong buy) stock.

Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor in charge of the market-beating Zacks Value Trader service. You can follow her at twitter.com/traceyryniec.

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