NEW YORK, Sept. 13, 2004 (PRIMEZONE) -- The following is an investment opinion issued by Investrend Research Syndicate:
Investrend Research Analyst Robert Vile CFA, CPA, has reiterated I-Sector Corporation (AMEX:ISR) as a "Strong Buy" with a target of $18.00 and maintained his 2004 and 2005 earnings per share estimates of $0.35 and $0.70, respectively, in an Institutional update.
Vile stated that, "ISR shares are currently selling at 19.3x our 2004 earnings per share estimate and 9.6x our 2005 earnings estimate. We estimate revenues will grow 48% this year to $92.1 million and 30% next year to $119.7 million. With a current market cap of approximately $37.1 million, ISR shares sell at 40% of our 2004 estimated revenues and 31% of our 2005 estimated revenues. ISR shares sell at a significant discount to the 2005 communication equipment/IP telephony group average in terms of price/sales (2.0x) and price/earnings ratios (25.2x)."
Vile believes that, "This discount is unwarranted given the expectation of strong revenue growth, higher gross margins and increasing profitability. We believe the company is valued at approximately 26x our 2005 earnings per share estimate, or 1x our 2005 revenues estimate." He said his 12-month target valuation is $18.00 per share.
Commenting on the second quarter, "Revenues and gross profit increased 38% and 58% yoy, respectively in the June quarter. Management revised its revenue guidance upward for the third quarter to ($24 -- $28 million) and fourth quarter ($24 -- $27 million) of the year. Management expects to record a profit in the 3rd quarter of $600,000 -- $900,000 ($0.11-$0.17 per share), and a profit in the fourth quarter of $200,000 -- $400,000, ($0.04-$0.07 per share). We believe the company's third quarter guidance is conservative and that sales and earnings will come in above the high end of the range."
The full report, including important disclosures and disclaimers, are available at http://www.investrendresearch.com, and at the company's InvestorPower page at http://www.investrend.com/company/list.asp?sPathParam=yes and investors are advised to read those disclosures carefully before trading in the equities of any enrolled company.
The analyst's credentials are at http://www.investrend.com/articles/secondlevel.asp?level=238
I-Sector Corp is enrolled in Investrend Research's pioneering professional research program, which facilitates independent analysts to provide financial coverage for shareholders in companies that otherwise, would have little or no analyst following. Enrollment fees for Institutional coverage are $28,300 and the fees were paid by the company. Analysts are paid in advance of initial reports by Investrend Research to eliminate pecuniary interest, and neither the analyst nor principals of Investrend Research may own or trade in the stocks of companies under coverage.
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