UPDATE: Oppenheimer Reiterates RigNet at Outperform on Strong 4Q12 Results

In a report published by Oppenheimer, analyst Patrick Villani reiterated his Outperform rating and 12 to 18-Month price target on RigNet RNET. Oppenheimer reported that, “RNET posted strong 4Q12 results with revenue/adj. EBITDA beating our ests. and Nessco generating $13.1M in revenue (+27% seq.). We expect this business will grow steadily in FY13 ($56.5M, +6.5%) and help RNET capture new upstream (pumping as opposed to drilling) business. Our revised estimates indicate 2013 revenue of $224M, adj. EBITDA of $56M and EPS of $1.06 (down slightly due to increased taxes). Adding additional sites and increasing bandwidth per site remain the key business-model drivers. An average site has >1 MBps of capacity today, and we believe demand is increasing ~30% per year; this supports future ARPU growth and should steer margin back toward the low 30% area in a few years.” Shares of RigNet closed at $22.26 on Wednesday.