MICROS Systems Inc. (MCRS) reported earnings of 55 cents per share in the fourth quarter of fiscal 2011, easily beating the Zacks Consensus Estimate of 47 cents.
The company has a strong and expanding portfolio of products and services support, which will assist MICROS in delivering continued profitable growth.
Fourth Quarter Earnings Highlights
The company's revenue improved 10.4% from the year-earlier quarter to $274.1 million, driven by growth across all segments.
Geographically, revenues from domestic operations were 46% of the total and international operations accounted for 54% of total revenue.
Including one-time items, earnings per share were 50 cents compared with 42 cents in the year-ago quarter. During the fourth quarter, Micros recorded an impairment charge of $4.2 million related to its investments in auction rate securities.
Fiscal 2011 Highlights
Revenue for fiscal 2011 came in at $1,007.9 million, up 10.2% from a year ago. Including one-time items, earnings for the fiscal year were $1.74, up from $1.41 in fiscal 2010.
Agreements of Analysts
Out of the 8 analysts covering the stock, 4 have revised their estimates upward for 2012, while 1 moved in the opposite direction in the last 7 days.
In the last 7 days, 2 out of the 7 analysts covering the stock increased their estimates, with 1 analyst decreasing his/her estimate for first-quarter 2012.
Magnitude of Estimate Revisions
Based on the strong results, earnings estimate for fiscal 2012 increased 3 cents to $2.03 over the last seven days.
However, the earnings estimate for first quarter of fiscal 2012 was stable at 45 cents since the earnings release.
Our Take
We believe that the company’s growth will be driven by its acquisitions, partnership agreements and product innovation.
MICROS acquired TIG Global, which allowed the company to offer complete end-to-end solutions to hotel customers for the marketing of hotel rooms, and alternative distribution platforms. The acquisition supports the company to augment its product offerings, widen its customer base and expand market share.
Simphony, the company’s service offering helps the clients in performing mission critical operations in the event of an upstream failure.
The company has entered into a partnership agreement with VeriFone Systems Inc. (PAY) and Tabbedout to expand its mobile payment applications.
We are cautious about the sluggish domestic hotel business and the impact of rising gas prices on the restaurant business.
We have a long-term Neutral recommendation on MICROS. Currently, MICROS has a Zacks #3 Rank, implying a short-term 'Hold' rating.
About Earnings Estimate Scorecard
Len Zacks, PhD in mathematics from MIT, proved over 30 years ago that earnings estimate revisions are the most powerful force impacting stock prices. He turned this ground breaking discovery into two of the most celebrating stock rating systems in use today. The Zacks Rank for stock trading in a 1 to 3 month time horizon and the Zacks Recommendation for long-term investing (6+ months). These “Earnings Estimate Scorecard” articles help analyze the important aspects of estimate revisions for each stock after their quarterly earnings announcements. Learn more about earnings estimates and our proven stock ratings at http://www.zacks.com/education/
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