SAN FRANCISCO (AP) -- Flir Systems Inc.'s stock price may not rise as much as previously projected because of a recently completed acquisition that threatens to pull down the high-tech camera supplier's earnings.
THE OPINION: Raymond James analyst Brian Gesuale lowered his 2011 earnings forecast to $1.65 per share from $1.79 per share after assessing the potential impact of Flir's $268 million acquisition of ICx Technologies Inc. He concluded ICx's security technologies aren't as profitable as the thermal imaging systems that Flir sells to the military, other government agencies and corporate customers.
Although Flir may not make as much money from the sales, Gesuale said he expects the addition of ICx too boost the company's revenue slightly next year. He now foresees $1.58 billion in 2011 revenue, up from $1.54 billion previously.
Gesuale's earnings outlook is below the average estimate among 15 analysts polled by Thomson Reuters. The collective forecast calls for Flir to earn $1.74 per share on revenue of $1.56 billion next year.
THE STOCK: Flir's shares gained 22 cents, less than 1 percent, to close at $25.28 in Tuesday's market surge. Gesuale downgraded Flir's stock to "outperform" from "strong buy," and says the shares could rise by 19 percent during the next 12 months to $30. He previously had set a 12-month target of $40.