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| Friday, June 23, 2006 |
Blackboard Inc. Raises Guidance, Lowers Integration Costs for Acquisition
NEW YORK -- Shares of Blackboard Inc. may see some activity Friday a day after the education software provider boosted its guidance for the second quarter and the year on stronger demand for its products.
Late Thursday, the company said it expects to lose between $6.7 million and $7.1 million in the second quarter, or 23 to 24 cents per share, compared with previous guidance of a loss between $8.3 million and $8.7 million, or 28 cents to 30 cents per share. Blackboard raised its revenue projection for the quarter by $1.3 million to a range of $41.8 million to $42.8 million.
The company said the integration of its $178.3 million cash purchase of fellow education software company WebCT is going more smoothly than expected, and it forecast a $4 million charge related to the deal in the second quarter, which is $1.4 million less than expected. Blackboard expects a deal-related charge of $13.5 million for the year, versus its prior estimate of $18 million.
ThinkEquity analyst Kirsten Edwards upgraded Blackboard's stock to "Buy" from "Accumulate" on the news, raising her price target by $1 to $32.
In a research note to investors, Edwards said the company is showing "solid customer retention" during contract renewal season, and she is confident Blackboard is keeping a rein on the cost of integrating WebCT.
Its stock has declined 16 percent in the last two months even as market fundamentals remain strong, she noted.
For 2006, Blackboard expects to lose $12.7 million to $13.7 million, or 43 cents to 47 cents per share, versus previous guidance for a loss of $14.7 million to $15.9 million, or 50 cents to 54 cents per share.
Revenue is seen in a range of $173.1 million to $176.1 million, compared with previous guidance of $170 million.
Analysts polled by Thomson Financial forecast a second-quarter loss of 29 cents per share on $41.4 million in revenue, and a loss for 2006 of 52 cents per share on $171.6 million in revenue. |
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