Analyst: Bankruptcies Buoy Epiq Systems

NEW YORK (AP) — Epiq Systems Inc. shares advanced in afternoon trading Wednesday after a KeyBanc Capital Markets analyst upgraded the company on momentum in its bankruptcy business.

Shares of the Kansas City, Kan.-based company, which provides technology services to the legal industry, jumped $1.24, or 9.1 percent, to $14.85.

KeyBanc analyst Steven Koenig pointed to Epiq's work on Chrysler's bankruptcy as well as an estimated 60 percent year-over-year rise in overall bankruptcy filings in U.S. courts during the fourth quarter of last year.

"We believe strong bankruptcy momentum is sustainable for many quarters or years, as historical data suggests filings can continue to increase even after a recovery begins," Koenig told clients in a note Tuesday, upgrading shares to "Buy" from "Hold."

He raised his revenue estimate for 2009 by $6 million to $220.3 million, assuming 35 percent growth in the company's bankruptcy segment. He also upped his 2009 profit estimate to 73 cents per share from 69 cents, and boosted his 2010 forecast by 4 cents to 88 cents per share.

On average, analysts are expecting a profit of 69 cents per share on $214.2 million in revenue for 2009, and 85 cents per share in 2010, according to a Thomson Reuters survey.

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