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On June 7, InfoSpace, Inc. announced it would change its name to Blucora, Inc. (BCOR). The change was prompted by the company's January acquisition of TaxAct, Inc., a provider of online tax preparation software.

With earnings coming on Thursday, BCOR still looks like a strong value. At Friday's close of $13.10, the stock is trading near a four-year high, but still may have room to run. The legacy InfoSpace business, which operates search engines including webcrawler.com and dogpile.com, has shown strong cash flow generation over the last three years, despite minimal revenue growth.

TaxAct, meanwhile, has shown revenue growth averaging nearly 20% a year since 2006, according to InfoSpace's presentation [pdf] on the acquisition. The combination of consistent profitability and growth through TaxAct bodes well for Blucora; yet the stock seems reasonably valued, trading at just 14 times expected 2012 earnings, and a bit more than 10x 2013 projections.

In addition, Blucora has over $700 million in net operating loss carryforwards (NOLs), which can be used to eliminate taxes on future profits. And heading into Thursday's earnings, a strong season for TaxAct could provide a short-term boost. According to comScore, TaxAct is second in market share in the online tax preparation market, trailing only giant Intuit Inc. (INTU). For the key part of tax season, ending April 18, comScore estimated that TaxAct saw year-over-year growth of nine percent. As a result, Benchmark Co. wrote the following about BCOR's Q2 earnings prospects, according to theflyonthewall.com:

Benchmark Co. continues to view Blucora as an attractive investment and believes the risk/reward for shares is favorable around the company's Q2 earnings report. The firm keeps a Buy rating on the stock with a $17 price target.

Even if another earnings beat—Q1 earnings drove BCOR up over 10 percent—doesn't occur, long-term investors have plenty of reason to pick up Blucora stock. The potential of a near-term boost, thanks to a strong second quarter for TaxAct, only adds to the bull case.

Source: Blucora: New Name, Same Bull Case Heading Into Earnings