Ahead Of The Bell: Radiant Systems Upgraded

HARTFORD, Conn. (AP) — An improved outlook for a key market of Radiant Systems Inc. and the success of its payment processing product prompted an analyst Monday to upgrade the manufacturer of touch-screen point-of-sale systems.

Wedbush Morgan Securities analyst Gil B. Luria upgraded Radiant to "Outperform" from "Neutral."

Checks of restaurants have shown quarter-over-quarter improvements and a stronger outlook for the Alpharetta, Ga., company's restaurant technology market and potential benefits of its payment processing system, he said in a client note.

In addition, bundling its theft-deterrent product with its payment processing system has been a "runaway success" for Radiant Systems, Luria said.

Radiant Systems may be able to achieve half of its 4 percent increase next year based solely on the growth of the payment processing business, he said.

The company may even benefit as customers of Heartland Payment Systems seek alternative payment processing providers following a breach at the Princeton, N.J., provider of card processing, payroll and other services, Luria said.

He increased his 2010 earnings per share estimate to 80 cents from 76 to reflect the success of the payments business. And he maintained his 2009 estimate of 69 cents per share.

Analysts surveyed by Thomson Reuters expect Radiant Systems to earn 77 cents per share for 2010 and 67 cents per share for 2009.

Luria increased his price target to $13 from $10 to reflect higher estimates and reduced risk.

Shares rose 16 cents to $10.75 in premarket trading.