Earnings Preview: ValueClick

ValueClick (VCLK) is expected to report Q1 earnings after market close Tuesday, May 6, with a conference call scheduled for 4:30 pm ET.

Guidance

The consensus estimate is 16c for EPS and $169.62M for revenue, according to First Call. Citigroup, for the June quarter, is expecting $173M in revenue, $42M in EBITDA and 17c in GAAP EPS, relatively in-line with the Street. On the Q4 conference call, management gave signs that ValueClick's Lead Gen business is stabilizing, so investors curious if that continued into this quarter.

Analyst Views

Citigroup said it looks the company has likely continued their share buyback into Q1, and could continue to buy back more shares throughout the year. Citigroup sees two new emerging growth drivers for ValueClick's display advertising business, behavioral targeting and online video advertising. The firm said the company also may be well positioned to launch an online ad network exchange in the not-too-distant future. Citigroup is modeling negative 20% quarter-over-quarter growth in the company's comparison shopping business for Q1. If the economic conditions continue to worsen, they believe this business could be adversely affected. With the FTC investigation resolved, ValueClick settled by paying a modest $2.9M fine in Q4, and the Microsoft (MSFT)/Yahoo! (YHOO) deal dead for now, Citigroup believes ValueClick becomes an attractive target.