the street is expecting FSYS to increase its revenues 7% in 2013, from $385 million to $412 million. That translates into a 125% earnings gain from 24 cents to 54 cents. Are these estimates too lofty? according to Lake Street Capital,they are, The firm thinks that FSYS guidance will not match the Street's enthusiasm, but still offers a buy rating. I think Lake Street is just trying to lower expectations.
I know NOTHING about accounting but have been long FSYS for quite some time. Can you please explain to me how a 7% increase in revenues translates into 125% gain in earnings? I know that there is no direct relationship between the two, but that just sounds way out of whack to me. On the other hand, I hope you're right. Thanks.
GHONDULA: it all about costs ..FSYS 's costs should be falling in 2013....if you sell $100 in 2012 and your costs ARE $76, you made $24...If in 2013, you sell $107, but your costs fall 30% to 53 cents, you made $54 or 125% more than the previous year