Macrovision Keeps Turnaround Moving

SAN FRANCISCO - Shareholders took MacrovisionMVSND down a notch Thursday after the company posted slower growth for the first quarter, missing Wall Street estimates.

But the heavy lifting of a merger and restructuring is largely behind it - and investors may have received an entry point, if they're willing to wait to reap the upside.

The stock was down 96 cents, or 5.9%, to $15.18 after the company said Wednesday that its traditional analog software business fell.

Yet Macrovision executives were upbeat on the conference call, coming off a just-completed a merger with Gemstar-TV Guide and a realignment of the core business around new digital software patents and integrated TV programming guides and services. Macrovision is in the process of selling off noncore product lines, including TV Guide magazine.

In downgrading Macrovision shares to hold Thursday, Deutsche Bank analysts wrote that the long-term opportunity in the stock appears significant, but that shares will be range-bound for the better part of 2008. The firm makes a market in shares of Macrovision.

Macrovision projected combined 2008 revenue growth of 11% on an adjusted, pro forma basis, for a range of $650 million to $700 million. Earnings before interest, taxes, depreciation and amortization will be from $230 million to $270 million, said CFO James Budge.

"The ability to stream-line the business around digital media technologies should lead to a higher-growth and more-profitable company heading into 2009," Deutsche Bank's Todd Raker and Brian Thackray wrote.

The content-protection-software company has put more than half of its restructuring behind it as it moves away from its traditional analog software, positioning itself for growth as the world switches to digital television.