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Zygo Corp (ZIGO) has worked its way back into profitability and estimates are showing fantastic growth.

Company Description

Zygo Corp makes precision measurement solutions, medical lasers and other electro-optical devices for semiconductor, medical, scientific and industrial applications.

Back in the Black

On Aug 19 Zygo reported fiscal fourth quarter results that showed a 20% increase in revenues over the same period last year, to $28.5 million. Net earnings came in at $4.1 million. In the final period last year the company reported a net loss, even after stripping out massive one-time charges. This was the first quarterly profit in almost 2 years.

Earnings per shares were 23 cents, easily beating expectations of just 10 cents. Zygo has only missed expectations twice in the past 5 years.

Big Turnaround

Currently there is only 1 analysts covering Zygo, but that can be a benefit for us. With fewer eyes on the company, they have a better chance to post big surprises and subsequently big price movements.

That analyst raised the full-year fiscal 2011 estimate 18 cents, to 50 cents after the earnings report. Next year's forecast rose 8 cents, to 68 cents. Last year the company lost 9 cents, making a good turnaround story.

The Chart

Shares of ZIGO have a very nice upward trend going, starting from the earnings release. The stock continues to mark higher highs and as ZIGO hits the trend line here I am looking for yet another new high, making a great entry point.

Zygo Corp - ticker ZYGO >

Bill Wilton is the Growth Stock Strategist for He is also the Editor in charge of the market-beating Zacks Growth Trader service

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