by Michael VodickaMarch 17, 2011 | Comments : 0 Recommended this article: (0)
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MicroStrategy operates as a business intelligence software maker that helps companies collect and analyze data. The company was founded in 1989 and has a market cap of $1.2 billion.
Although the general trend for MSTR has been higher for the last few years, shares took a cosmic jump in late January after the company reported strong fourth-quarter results that handily beat expectations.
Revenue for the period was up 31% from last year to a record $139 million. Earnings also looked great, coming in at $1.60, 72% ahead of the Zacks Consensus Estimate.
The gains were driven by licensing revenue, which increased 59% to $48 million. Its largest segment, support and service for its business intelligence suite, saw sales increase 20% from last year to $86 million.
Moving forward. MicroStrategy will continue to benefit from its strong financial profile, with cash and equivalents of $174 million and no long-term debt.
We saw some pretty solid movement in estimates off the good quarter, with the current year adding 33 cents to $3.79 and the next-year estimate gaining 99 cents to $4.74, a bullish 25% growth projection.
In light of the recent gains, MSTR trades at a premium to its peers with a forward P/E of 30X compared to 23X.
On the chart, MSTR has been trending higher for most of the last two years before jumping higher to a new high on the good earnings surprise. Look for support from the long-term trend on any weakness. Take a look below.
Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the Zacks Momentum Trader Service.
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