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by Michael VodickaDecember 06, 2011 | Comments : 0 Recommended this article: (0)
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Stamps.com, Inc. provides Internet-based postage solutions. The company was founded in 1996 and has a market cap of $384 million.
STMP has seen big gains over the last few months, but shares got an extra boost on October 27 when the company reported strong Q3 results that came in ahead of expectations.
Revenue for the period was up 20% from last year to $25 million. Earnings also came in strong at 30 cents, 30% ahead of the Zacks Consensus Estimate, where the company has an average earnings surprise of 75% over the last four quarters.
Strong sales growth was coupled with an impressive margin profile, with PC Postage gross margin coming in at 77.7%.
Stamps.com will continue to benefit from its strong financial profile, with cash and short-term investments of $40 million and no long-term debt.
We saw some bullish movement in estimates off the good quarter, with the current year adding 10 cents to $1.09, a 118% growth projection from last year.
With a forward P/E of 24X, STMP trades at a premium to the market and its peers.
On the chart, shares hit a new multi-year high in late October on the good quarter. Look for support from the trend line 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 market-beating Zacks Whisper Trader Service.
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