While VistaPrint NV's (VPRT) earnings for the fourth quarter of fiscal 2011 were well ahead of the Zacks Consensus Estimate, we believe that the slow pace of the economic recovery coupled with huge investments in 2012 and 2013 to attract customers will restrict improvements in its top as well as bottom lines. The new set of initiatives also involves increased risks and lack of visibility toward return on investments at the current level.
Moreover, growth in key operating matrices remains stagnant. Substantial exposure to international markets also makes the company vulnerable to currency fluctuation risks.
Hence, we downgrade the stock from a Neutral to Underperform rating. VistaPrint currently carries a Zacks #5 Rank (Strong Sell).
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