Stamps.com Keeps Running Higher; Will It Last?

Small-cap name Stamps.com (NASDAQ: STMP) has been displaying bullish activity in recent weeks, and hit a new 52-week high on Wednesday. At last check the shares were up around 9% at $22.81 on unusually heavy volume. The catalyst for today's move appears to be the company's presentation at the ThinkEquity Growth Conference, which took place yesterday.

Stamps.com (STMP) also reported a blowout quarter back on August 1st, which put it on investors' radar. The company reported non-GAAP EPS of $0.45 compared to analysts' consensus estimates of $0.23. They also raised their full-year EPS guidance to $1.10 to $1.30 versus analysts' expectations of $0.95. Total revenues increased by 26% to $26.6 million for the quarter, which easily exceeded consensus revenue estimates of $22.12 million.

The company also raised its full-year revenue guidance to $90-$100 million versus previous expectations of $85-$95 million. This compared to Wall Street consensus expectations of $90.75 million for the fiscal year. In the last month, STMP shares are up better than 42% and over the last 6 months, the stock has appreciated more than 85%.

Valuation is starting to catch up with Stamps.com's better than expected outlook, but there may be more room to run for the stock. Shares trade at a trailing P/E of 31.20, a forward P/E of 18.18, and a PEG ratio of 0.97.

At this point, STMP's future outlook may be dictated to a significant extent by the direction of the broader market. It is not at all unreasonable to think the stock can continue to run in a strong tape, but conversely it is also hard to see the shares continue at their current trajectory is the broader market breaks down.

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