"While the award of the Aura contract to a competitor is disappointing, we continue to see abundant opportunities for continued high growth," said Leonard Moodispaw, the company's president and CEO, in a statement. "Although this contract has captured a great deal of interest by our investors, we continue to view it as only one part of a much larger plan to build on the core strengths and focus of KEYW as a leading provider of mission critical cyber and intelligence solutions to the defense and intelligence communities."
The stock was last quoted at $7.70, down 23%, on volume of less than 15,000, according to Nasdaq.com. The Hanover, Md.-based cyber security company went public last September, selling 9.1 million shares at $10 each, pricing at the bottom of its expected range. The stock ran as high as $16 last December, and was down more than 30% since the start of 2011 prior to the after-hours move.
Noble Financial issued a research note on Sept. 9 discussing the impending decision on the contract. The firm said the contract was believed to be with the National Security Agency, and estimated the deal would have represented $65 million worth of its 2012 revenue estimate of $370 million. It judged the company to be in fairly good shape, even if this scenario came to pass."While a contract loss would be a negative, the company should have $305 million of 2012 revenues excluding the contract, which would justify a high single-digit trading valuation," Noble Financial said. "We rate shares a Buy and believe the company's projects will be well funded and support 20% organic growth assumptions." KEYW is expected to report its fiscal third-quarter results on Oct. 31. The average estimate of analysts polled by Thomson Reuters is for earnings of a nickel per share on revenue of $55.5 million in the September-ending quarter. The five analysts covering KEYW are all bullish, split between strong buy (2) and buy (3) ratings. --Written by Michael Baron in New York.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV