Steinway Musical Instruments, Inc.

Steinway Musical Instruments, Inc. (LVB) recently reported solid second-quarter results in which the company was able to grow its revenue in its two primary business segments. The next-year estimate is bullish, and the company's share price is pressuring a short-term level of resistance.

Company Description

Steinway Musical Instruments, Inc. designs and manufactures pianos and band and orchestral instruments. The company serves both amateur and professional musicians in the United States and internationally. Steinway was founded in 1993, has a market cap of $252 million and is headquartered in Waltham, Massachusetts.

Second-Quarter Results

Steinway released solid second-quarter results on Aug 5 that demonstrate the company's ability to effectively execute a plant restructuring initiative and grow its earnings in a tough environment.

Revenue increased 7% from last year on strong sales in the company's band and piano segment. When removing one-time restructuring and cost items, earnings totaled 47 cents per share, well ahead of analyst estimates of 31 cents per share.

Segment Performance

Band sales for the period increased by 8% from last year. Piano revenues were up 4% from last year, increasing by $2.2 million.

CEO Dana Messina said that, "In the midst of band plant consolidation and a difficult U.S. economy, both the band and piano divisions posted increased sales for the period."

Analyst Estimates

In light of the solid quarterly results, the current-year estimate has advanced to $2.15 per share from $2.00 per share 30 days ago. The next-year estimate stands at $2.55 per share, a 19% earnings growth projection.

Based upon the current-year earnings projection, this stock has a forward P/E multiple of 13.7X, a slight discount to the overall market.

The Chart

Shares of LVB have been advancing since early July after bottoming out at less than $25. As it stands, this stock is pressuring a short-term level of resistance just above the $29 mark. With a solid quarter in the bag and a bullish earnings projection in tow, shares of LVB look well positioned for more growth. Take a look at the chart below.