VDSI

[David Randolph]

June 1st, 2007:

VDSI initial video analysis:

[la-onda]

VDSI: ThinkEquity Ups to Buy from Source of Funds; Ups Tgt to $30 vs $23; Analyst Notes
Tuesday , December 04, 2007 07:12ET
Issuer: Vasco Data Security International Inc (NasdaqSC: VDSI)
Analyst Firm:  ThinkEquity Partners
Ratings Action: UPGRADE
Current Rating: Buy (from Source of Funds)
Target Price Action: INCREASE
Target Price: $30.00 (+30.43% from $23.00)
Analyst Comments: The firm believes risk in shares is reflected in current valuation.

[David Randolph]

I want to know what happened to VDSI in point 1, when the company had that huge gap down shown on the chart below:

Vasco misses estimates

So, VDSI made $0.15 EPS for the quarter, which annualized is $0.60. With the stock trading around $28, the P/E is 47, which is incredibly high for a company which just missed expectations.

I'm not a bull in VDSI, I think the stock will be below $20 again in the near future.

[la-onda]

Soleil Securities Group likes VASCO Data Security

Soleil Says Buy VASCO Data Security (VDSI) On Weakness

Soleil Securities Group says VASCO Data Security (Nasdaq: VDSI) looks extremely attractive due to recent weakness. The firm has a Buy rating and $41 price target on VASCO, which represents a 105% premium from its current price of around $20. The firm pointed out VASCO's 53% slide since the end of October, compared to an 11% decline in the S&P over the same period, and would suggest starting or adding to a position as the current price appears to be a great entry point. In the research report, Soleil noted that 92% of VASCO's revenues come from outside the U.S., making the 11% depreciation of the U.S. dollar vs. the Euro during the fourth quarter more substantial as VASCO will see a positive impact to its earnings from this over the period.

http://thestockmasters.com/Soleil-likes-VASCO.html

[David Randolph]

Analysts kept reaffirming their positive ratings and recommending buying VDSI, and yet the stock kept falling like a rock.

I said VDSI be below $20 ...

So, VDSI made $0.15 EPS for the quarter, which annualized is $0.60. With the stock trading around $28, the P/E is 47, which is incredibly high for a company which just missed expectations.

I'm not a bull in VDSI, I think the stock will be below $20 again in the near future.

... when it was at $28.6, but yesterday it closed at $13.29:



What happened in point 2?

• Vasco Data 4Q Profit Falls on Delays
AP (Thu, Feb 21)

So, EPS for the quarter was just 9 cents. Using the same simplistic calculus as before, if every quarter was like this, VDSI would make $0.36 EPS. With the stock trading at $13.29, the p/e multiple would then be 37.

But, of course, analysts expect better numbers, even though they're less enthusiastic than before:



We'll see what the next few quarters bring ... for now VDSI has decreasing earnings, a high p/e and a bearish chart. 

[la-onda]

Hi David, what's your tool comment on VDSI?
from 44 to 10 
cheers
Oliver

VDSI: Expects Accelerated Growth for Second Half on Q1 Order Flows
Thursday , April 24, 2008 14:25ET

By Michael Cavallaro, [email protected]

Trading on Vasco Data Security International Inc (NasdaqSC: VDSI) was down 22.704% following this morning's earnings call in which the company reported Q1 revenues of $28.93M, up 9.56% from a year ago and missing consensus by 10.99%. Q1 EPS was $.13, flat from a year ago and beating consensus by 8.33%.

During the call, the company stated that it sold an additional 591 new accounts, which included 71 banks and 520 new enterprise security customers, bringing the total of number of customers to 7100 in more than 100 countries around the world. While the company has not lost any business from the subprime slowdown, there was a general slowdown in the approval process with banking customers that affected first quarter results. Going forward, the company expects 2008 to be period of investment in Vasco infrastructure and increased headcount as it pursues an aggressive hiring plan.

Overall, Vasco saw a 3% increase in the banking market and a 48% increase in the enterprise security market. The results showed a complete shift from last year's period, which saw 85% of revenue from banking and 15% from enterprise security. Vasco was also positively impacted by a weaker dollar, in which revenues were 7% higher than they would have if the dollar remained at last year's levels.

As the comp any plans to continue infrastructure investments, it remains comfortable in guiding to operating margins of 20-25% for the year. Despite forecasts of a sequential increase, it advised that there may be occasions where it may drop below 20% due to seasonality in sales. However, with three consecutive quarters of disappointing results relative to the street, the company expects accelerated growth in the second half and explained that its forecasting system is weighted on backlog and the confidence level of different transactions.

Said CFO Cliff Brown, "We saw a slowdown in the sales order process for the first quarter. The slowdown affects the current quarter, but gives us a stronger view of the subsequent quarters. Because we had strong order flow, Q2 and Q3 will be stronger quarters than in previous years. We have more visibility in what we see from order flow and pipeline.

&

VDSI: Morgan Keegan Cuts to Mkt Perform from Outperform; Analyst Notes
Thursday , April 24, 2008 10:58ET
Issuer: Vasco Data Security International Inc (NasdaqSC: VDSI)
Analyst Firm:  Morgan Keegan Inc.
Ratings Action: DOWNGRADE
Current Rating: Mkt Perform (from Outperform)
Analyst Comments: Vasco reported Q1 2008 non-GAAP EPS of 13c per share on revenue of $28.9 million, beating the firm's bottom line estimate of 12c, but disappointing on the revenue side, which they expected to be $32.5 million. The street consensus forecasted EPS of 13c on revenue of $32.5 million.

&

VDSI: Short Interest DN 14.1% to 3.1M in Mid Apr 2008
Thursday , April 24, 2008 16:23ET

According to new short interest data from NASDAQ, short interest for Vasco Data Security International Inc (NasdaqSC: VDSI) DECREASED 14.1% to 3,068,035 shares as reported in mid-April, 2008. Based on VDSI's 20-day average daily share volume of 514,790, it would require approximately 6 day(s) of buying to cover this short interest.

[pinoleropuro]

 

[la-onda]

Event
We have upgraded shares of Vasco to Buy from Hold, while keeping
our estimates the same and our price target at $13.
Key Points
• Tough sledding in late 2007 and Q1:08, but expectations are
now in the cellar. Vasco has missed consensus revenue and/or
EPS in each of the past three quarters due to slowing IT spending
in Europe, which has manifested itself in procurement delays and
deal slippage. Consequently, the stock has decreased from a high
of ~$42 to ~$10 in the past six months.
• VDSI shares are now trading at 16x our '08E EPS, 13x our '09E
EPS, and 16x and 12.5x, respectively, on consensus. This is about
a 50% discount to mgmt's stated y/y revenue growth rate of 25-35%
in 2008. Our model calls for 22% top line growth; consensus is
20%. Even if guidance was cut to 20% growth, the stock would be
trading at a discount.
• We think the worse is behind them, evidenced by an increase in
component part inventory for products that are slated to ship over
the next few months. They are also hiring in sales, making their
claim for 30% revenue growth this year more credible ("putting their
money where their mouth is").
• Our below-consensus estimates remain unchanged for now.
We anticipate getting more data from field checks over the next
several weeks. But the stock is too cheap to ignore at the current
level, in our view, and the y/y comps get very easy after the June
quarter.

Valuation/Risks
Our $13 PT is 17x our '09 EPS estimate of 76c, well below the
two-year revenue growth rate of 25%. Investment risks include:
competition from the much larger EMC (EMC, $15.42, Buy),
significant financial services exposure, potential pricing pressure and
IT spending weakness.

more infos:
http://www.knobias.com/research.pdf?id=13162