Piper Jaffrays Sees 100% Upside In Dollar Financial (DLLR)
Piper Jaffray said it sees more than 100% upside in shares of Dollar Financials (NASDAQ: DLLR) after the company reported much stronger than expected earnings. It has an Overweight rating, to go along with its $32 price target.
In a note to clients, Piper Jaffray writes, "DLLR reported 4Q adjusted EPS of $0.42 vs. our estimate of $0.40 and consensus of $0.38. DLLR gave initial guidance for fiscal '11 (June) of EPS of $2.05-$2.30, excluding deals, vs. consensus of $2.01 and PJC at $2.17 (includes $0.13 for deals). Adjusted for one announced deal and cash hedge expenses which will disappear in Oct. '12, DLLR EPS power could be about $2.90 in '11. DLLR is accelerating growth significantly in the U.K. and Canada and its recently announced deal moves the company further into Europe. DLLR is a rapidly growing company with strong cash flow trading at extremely discounted valuations of about 5x estimated EPS earnings power and 3.6x/3.0x '11/'12 EBITDA. We reiterate our Overweight rating and $32 target."
Shares of Dollar Financial closed at $15.62 yesterday, good for a gain of 56 cents.
