Bull Of The Day: Shutterfly, Inc. (SFLY)
Shutterfly’s (NASDAQ:SFLY) second quarter earnings were well ahead of the Zacks Consensus Estimate, driven primarily by higher revenues from the photo book. Increased usage of digital cameras combined with accessibility of high-speed Internet provides significant expansion potential for the company.
Product innovation, a focus on developing a successful commercial printing business, strategic partnerships with retailers and opportunistic acquisitions also bode well for the company. Although we find the ongoing economic weakness and rising unemployment hurting the company’s profitability, we believe margin will further expand in the coming quarters backed by technology leverage, lower material costs and labor efficiency.
Interface with social media and the approaching fourth quarter, which is a holiday season, will also act as key drivers of the stock, going forward. Hence, we upgrade the rating from Neutral to Outperform.
SHUTTERFLY INC (SFLY): Free Stock Analysis Report
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