CyberSource soars on improved Q4 outlook
CyberSource Corp. (Nasdaq: CYBS) soared after the electronic payment processor said its outlook is healthy and that third-quarter results were “strong.” The company also said its earnings estimates should rise after it closes an acquisition.
In June, Mountain View, Calif.-based CyberSource said it would buy Aurorize.net Holdings Inc., an electronic merchant services provider, for $565 million in a cash and stock deal.
After Thursday’s close, CyberSource recorded third-quarter revenue of $26.5 million, above analyst estimates of $23.81 million, and above $17.4 million a year earlier. The firm’s quarterly net income was $0.34 million, or $0.01 per share, below Wall Street projections of $0.06 per share and compared with $0.29 million, or $0.01 per share, during the same period of 2006.
"We are very pleased with our record results this quarter, which reflect the strength of our broadening customer base and our momentum within the eCommerce market," CEO Bill McKiernan, said in a statement. "CyberSource added approximately 2,000 new customers in the quarter, increasing our customer base to approximately 22,000."
For the fourth quarter, CyberSource said it expects $31.5 million in revenue, above analyst estimates of $27.66 million. The firm expects net income of $1.7 million, or $0.04 per share, during the fourth quarter, which is below Wall Street estimates of $0.13 per share. These estimates do not include any benefit that would be realized by the acquisition of Authorize.net.
Jonathan Maietta, an analyst for Needham & Co., raised his rating today on Cybersource’s stock to "buy" from "hold.”
In afternoon trading, CYBS shares are soaring 18.98%, or $2.39, at $14.98. Over the last 52 weeks, shares have ranged from $9.37 to $16.13.
About the Author
Reporter Will Atkinson is based in SmallCapInvestor.com's Washington, D.C. bureau.
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