Mentor Graphics Jumps on Outlook

Mentor Graphics(MENT Quote) shares surged Wednesday after the company said it had record revenue and bookings in its fourth quarter.

Recently shares were up $2.20, or 14%, to $17.92.

The Wilsonville, Ore.-based software and hardware manufacturer said revenue topped its $190 million forecast, but held to its earnings guidance of 30 cents a share, excluding items.

The Thomson First Call consensus estimate is 31 cents a share. The company earned 29 cents a share on revenue of about $180 million in the year-ago period.

The company said earnings would be tempered by higher operating costs because of the weak dollar and significant incentive payments.

The company said its book-to-bill ratio was "significantly greater than one."

The better-than-expected revenue was led by exceptionally strong demand for its Calibre product line. Bookings during the quarter tripled, which also triggered incentive payments to engineers.

The company said it will take a $10 million pretax charge, which will knock 14 cents a share off of earnings.

Mentor releases fourth-quarter and full-year results on Jan. 27.