Big Data company Attunity (ATTU) has been trading in the U.S. market for about 25 years, but it is a fresh face when it comes to the leading stocks in IBD’s Stock Spotlight.
Attunity’s earnings growth is growing sharply, although in the past few quarters the gains have compared favorably against single-digit earnings per share or losses in the year-ago periods. Revenue saw an accelerating growth trend from Q4 of 2017 (up 17% that quarter) to Q2 of 2018, when sales increased a beefy 47%. In Q3, revenue increased 35% vs. year-ago levels.
License revenue — an important factor for cloud-based providers like Attunity — surged 50% from the year-ago period, the company said in its most recent earnings report on Nov. 1, 2018.
The company at the time raised its 2018 full-year outlook. It forecast revenue gains of $83 million to $85 million, from a prior forecast of $78 million to $81 million. It put its operating margin at 13% to 15%, from earlier guidance of 7% to 10%.
More Deals, More Products
Israel-based Attunity cited more customer deals, expanding business from existing customers, growth in all its territories, expanded product offerings and more business from partner firms for the growth in the third quarter. It operates in North America, Europe, Asia and other areas through partners.
Analysts expect on average Q4 earnings of 11 cents a share, vs. 8 cents in the year-ago period. The consensus revenue estimate is $23.9 million, up from $18.3 million.
Attunity shares jumped more than 7% Tuesday, when the company made a presentation at a Needham conference in New York.
The stock is forming a cup base with a 23.95 buy point. The relative strength line made a new high this week, a positive sign as investors wait for the stock to break out. Shares punched above the 10-week moving average this week, too, improving the chart profile.
Technically, the current pattern is a third-stage base since an initial breakout last May. That’s because the current base started forming after shares climbed 22% from the 19.66 entry of the previous base, a double bottom.
But viewing the chart from a distance (take that to mean the weekly chart), the new and the most recent bases kind of run together. So, in a practical sense, it’s hard to treat the new base as third stage.
The small cap is thinly traded, and still has a relatively modest number of funds that own its shares. Still, institutions hold more than 30% of the company’s stock, according to IBD’s database. Attunity has 21 million shares outstanding; the market value is around $487 million.
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