New Frontier's Earnings Surge

Earnings at New Frontier Media(NOOF Quote - Cramer on NOOF - Stock Picks) surged 40% higher, as the video porn company beat Wall Street expectations.

The Boulder, Colo.-based company reported first quarter net income of reported $3.5 million, or 15 cents a share, up from $2.5 million, or 8 cents a share. Net revenue rose 48% to $16.3 million. The company's fiscal year begins in April.

The Thomson Financial consensus estimate had New Frontier earning 8 cents a share on revenue of $13.98 million.

The company also raised its earning guidance for fiscal 2007. It now expects to generate revenue between $60 million and $62 million and earnings per share between 42 cents and 47 cents.

Over the past year, New Frontier has garnered a lot of interest from hedge funds, who are some of the biggest investors in the company. The company's largest shareholder is Steel Partners, a $4 billion hedge fund run by Warren Lichtenstein, a manager with a reputation for holding a company's management to the fire.

In early trading shares of New Frontier were up 61 cents, or 9%, to $7.32 a share.