Hooray Versant!

Hasn't been much to cheer about lately, thought I'd focus on something positive.

VSNT seems like a classic MFI stock (think Jason's Bubble Gum). Small company, cheap, seems to have a competitve advantage and is growing. Wow.

My records have VSNT first appearing on the lists Aug 31, 2006 with a market cap of 30m. Six months later it had doubled with a market cap of 65m. It closed today at $77m. I don't think they're done. They announced earnings during happy hour this evening (Versant Announces Record Quarterly Net Income of $2.1 Million). In HH trading, they're up about 12%.

Their numbers were very good and they ended FY 07 making $2.06 per share (they had guided between $1.87 and $1.89). In addition they said that 2008 will have 13% growth and eps of $2.50. Given that they seem to "under-promise", the actual numbers could be better. They have decent visibility as the get a lot of revenues from licenses. If you assume they should trade at 13x earnings then that would put their price a year from now around $32. Today they are at $22.

Finally, they also have a bunch of cash, so the credit crunch should not be a factor. Over $19m in cash (a lot for a 77m company) compared to just $8m a year ago. All that cash did make me wonder what they're going to do with it. They did give a little hint:

"The Company currently estimates net income of approximately $9.5 million for fiscal 2008, resulting in estimated diluted net income per share of approximately $2.50 for fiscal 2008, based on the Company's current capitalization."

I think that suggests a stock repurchase or one time dividend.

Not much other news. GVHR dropped 5% after their 20% rise yesterday post the upgrade. I think a decent strategy would be to sell stocks the days of upgrades. They seem to invariably give back some of their one day gains.