Seeking Alpha
Profile| Send Message|
( followers)  

I ran a screen for potentially undervalued stocks which recently have beaten analyst estimates (last quarter and by at least 10%) and have been upgraded by the brokers. Moreover, I have screened only the stocks which have recorded 5 year EPS and revenue growth on average of at least 10% annually.

1) Spreadtrum Communications Inc. (NASDAQ:SPRD) - a fabless semiconductor company, engages in the design, development and marketing of mobile chipset platforms for smartphones, feature phones and other consumer electronics products in the People’s Republic of China and internationally. It reported $0.47 EPS in March 2012, beating average analyst estimates of $0.39 (20.5% surprise). The company has 5 year historic EPS growth of 83.53%. It is worth mentioning that this company is relatively cheap in terms of P/E (8.01) compared to industry (14.56). It also has a good PEG ratio of 0.46. On 7th of May, 2012, it was upgraded from Neutral to Overweight by HSBC.

2) Alere Inc. (NYSE:ALR) - develops and manufactures patient diagnosis, monitoring, and health management products and services for cardiology, infectious diseases, toxicology, diabetes, oncology and women’s health in the United States and internationally. It reported $0.67 EPS in March 2012, beating average analyst estimates of $0.77 (14.9% surprise). The company has 5 year historic EPS growth of 22.3%. Alere Inc. is relatively cheap in terms of P/E (8.22) compared to industry average (19.23). It also has PEG ratio of 0.69, showing good potential for growth. Price target consensus from 9 brokers is $31.11, having nearly 40% upside potential from today's price of $22.23.

Alere Inc. was upgraded from Hold to Strong Buy at Leerink Swann & Co. on 1st of May, 2012.

3) Web.com Group, Inc. (NASDAQ:WWWW) - provides Internet services for small-to-medium-sized businesses (SMBs) in North America, South America and the United Kingdom. It provides .com, .net, .co, .org, and .info domains, as well as domain services, including domain name registration, domain name transfers, domain name renewal, domain expiration protection and domain privacy services. It develops and supports a subscription Web service package that includes the tools and functionality necessary for a business to create and maintain online presence, as well as provide tutorials and tools for customers to edit and manage their sites.

It has reported $0.35 EPS in March 2012, beating average analyst estimates of $0.31 (12.9% surprise). The company has 5 year historic EPS growth of 22.79%. The company has good potential for growth (PEG ratio 0.7). P/E ratio (10.46) is similar to industry (10.58). Web.com Group Inc. was upgraded from Neutral to Positive at Susquehanna on 3rd of May, 2012.

4) True Religion Apparel Inc. (NASDAQ:TRLG) - designs, develops, manufactures, markets, distributes and sells apparel in North America, Europe, Asia, Australia, Africa and South America. It reported $0.41 EPS in March 2012, beating average analyst estimates of $0.36 (13.9% surprise). The company has 5 year historic EPS growth of 10.66%. The company has relatively low P/E ratio (13.68) compared to industry (23.44). It also has PEG ratio of 0.91. True Religion Apparel Inc. was upgraded from Above Average to Buy at Caris & Company on 3rd of May, 2012.

5) Edwards Lifesciences Corp. (NYSE:EW) - provides products and technologies to treat advanced cardiovascular diseases and critically ill patients worldwide. The company offers heart valve therapy products, including tissue heart valves and repair products, which are used to replace or repair a patient’'s diseased or defective heart valve and produces pericardial and porcine valves from biologically inert animal tissue sewn onto proprietary wire form stents. It has reported $0.53 EPS in March 2012, beating average analyst estimates of $0.48 (10.4% surprise). The company has 5 year historic EPS growth of 10.66%. The company relatively high P/E ratio (32.14) compared to industry (19.23). PEG ratio is 1.18. Edwards Lifesciences Corp. was upgraded from Market perform to Outperform rating at Wells Fargo on 2nd of May, 2012.

6) RailAmerica, Inc. (NYSE:RA) - engages in the ownership and operation of short line and regional freight railroads in North America. It has reported $0.26 EPS in March 2012, beating average analyst estimates of $0.18 (44.4% surprise). The company has a 5 year historic EPS growth of 95.82%.The company also has a PEG ratio of 0.64. However, it has relatively high P/E (16.96) compared to industry (15.71). RailAmerica Inc. was upgraded from Market Perform to Outperform at Wells Fargo on 30th of April, 2012.

7) Ascena Retail Group Inc. (NASDAQ:ASNA) - operates as a specialty retailer of apparel for women and tween girls in the United States, Puerto Rico and Canada. The company operates its stores under the dressbarn, maurices, and Justice brand names. It has reported $0.41 EPS in January 2012, beating average analyst estimates of $0.34 (20.6% surprise). The company has 5 year historic EPS growth of 18.65%. The company has relatively low P/E ratio (15.37) compared to industry (17.26) and PEG ratio of 1.02. Ascena Retail Group Inc. was upgraded from Hold to Strong Buy at Suntrust Robinson Humphrey on 3rd of May, 2012.

8) Concur Technologies, Inc. (NASDAQ:CNQR) - provides integrated travel and expense management solutions for companies of various industries, sizes, and geographies. It reported $0.22 EPS in March 2012, beating average estimates of $0.19. The company has 5 year historic EPS growth of 19.19%. Concur Technologies Inc. was granted Strong Buy status by Stifel Nicolaus Co., Inc on 3rd of May, 2012. However, it has relatively high P/E ratio (74.08) compared to industry (10.58), and high PEG ratio (3.11).

9) NuVasive, Inc. (NASDAQ:NUVA) - a medical device company that engages in the design, development and marketing of minimally disruptive surgical products and procedures for the spine. It has reported $0.20 EPS in March 2012, beating average analyst estimates of $0.18. The company has 5 year historic EPS growth of 64.88%. NuVasive Inc. was upgraded from Neutral to Outperform at RW Baird on 2nd of May, 2012. However, it has relatively high P/E ratio (21.81) compared to industry (12.07), and high PEG ratio (2.26).

Financial data and company descriptions were taken from Yahoo Finance.

Source: 9 Stocks With Recent Positive EPS Surprises And Upgrades