Stock Brief page. I love that site. I track stocks from RAD-Bynet group so I've been watching Radware. So...
Trading Points Earnings momentum at Radware (RDWR 21) is, indeed, impressive... The designer of Internet traffic solutions is expected to grow earnings per share 400% this year and 250% in fiscal 2001... At current price level, stock trades at 60 times FY01 estimates of $0.35 a share, translating to a PEG of 0.24.
The stock experienced a 14% intraday surge in price on Tuesday (closed with a 9% gain). Believe that advance was driven by anticipation of strong numbers by competitor F5 Networks (FFIV). While FFIV's results were impressive -- revenues increased 562% and earnings posted at $4.1 mln vs a yr-ago loss of $3 mln -- the earnings per share figure of $0.18 was only in line with Wall Street expectations.
Failure of F5 Network to meet the expectations of the momentum crowd could cause Radware to give back Tuesday's gains. But Radware has its own numbers coming out soon, and we believe the earnings will exceed expectations.
Company due to release Q1 results after the close next Monday. Wall Street looking for a profit of $0.01 a share for the quarter. Would expect Radware to at least double up the number with a $0.02 a share profit, though, earnings of $0.03 a share certainly not out of the realm of possibility.
Going into earnings last quarter, Radware pre-announced an upside surprise. The company then went on to exceed upwardly revised expectations.
RDWR possess the two qualities admired most by earnings traders: 1) the ability to deliver significant upside surprises to estimates; 2) a history of making substantial price gains in response to those earnings.
Stock has traded in a range of $17 5/8 to $87 since going public September 30 at $18 per share...
RDWR depending on this earnings report to nudge the stock clear of the relatively flimsy support existing at the $20 level.
The Tel Aviv-based company sports a float of 5.6 million shares... Short Interest is a nominal 170,000 shares or 0.8 days... Average daily volume 416,000.
I think the problem with FFIV is not Q1 results which were in line with expectations, but with their statement that they expect sequential sales growth in the low to mid teens.Such lower growth rates for a potential company means lower prices. RDWR promised record growth for Q1. Means sales should be above $7M which will bring EPS higher than $.01