Merrill Lynch: aQuantive Revenue To Surge 24% In '07
Merrill expects aQuantive this year to repeat the nearly 50% percent earnings-per-share growth it racked up in 2005. For next year, Merrill Lynch forecasts that earnings per share will grow at least 26%, while top-line growth will total 24%. Noting aQuantive's diverse portfolio, Fine added: "The company is a pure-play online media company with no client making up more than 5% of revenues and a portfolio of online services making it a one-stop shop for advertisers' online needs."
The note went on to credit aQuantive with strong overseas expansion potential, supported by a well-rounded management team: "22% of aQuantive's revenues are derived internationally and we expect the company to benefit from its continued expansion abroad, especially since online industry growth abroad is expected to outpace growth in the U.S."
The brokerage house qualified its generally positive assessment by noting "the possibility that expectations could rise quickly during a quarter, making it harder for the company to meet or exceed them."
Online agency Avenue A/Razorfish accounts for 60% of aQuantive's revenues, while its software business, Atlas, accounts for 30% of revenues, according to Merrill. The remainder of aQuantive's revenue comes from its "small ad network business."
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