Imation (NYSE:IMN) this morning reported profit per share of 53 cents, above the 46 cents analysts were expecting and sales of $424.7 million, above even the Street’s high number of $410 million.
Imation raised its profit forecast for this year to a range of $2.35 to $2.41, excluding some restructuring charges, up from $2.20 to $2.29, also above analysts’ average estimate of $2.31. A forecast for as much as $1.6 billion in sales this year is just slightly above analysts’ estimate.
A spinout of 3M (NYSE:MMM), Imation makes most of its sales from removable media, such as magnetic tape used to back up corporate data files – the kind of stuff used by Sun Microsystems’s (NASDAQ:SUNW) StorageTek and IBM’s large server computers. It’s a slow business — sales grew 5.3% from the year earlier period — but should come as a good sign of steady, stable growth in corporate spending on computer infrastructure.
Daniel Renouard, with R.W. Baird & Co., who rates the stock Outperform, raised his profit per share estimates for this year and next to $2.15 and $2.55 from $2.05 and $2.46. Renouard was pleased with the company’s $10 million buyback of shares, but wants to see the company be more aggressive buying back its stock.
The company’s acquisition of tape maker Memorex is “on track,” says Renouard, another positive. He says the shares could rise to $55 in the next 12 months.
Imation shares are up over 7% at $46.13. The shares have fallen 6.6% this year.