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Inside Wall Street
WIDER HORIZONS AT MASTECH
Like the shares of most other technology companies, Mastech (MAST) has been on a roller-coaster ride. After slumping from 30 in April to 16 in mid-October, Mastech is rising, hitting 20 on Oct. 20. Indeed, some think this information technology outfit is on its way to the mid-30s. What's the scoop?
For one thing, Mastech, which provides supplemental staffing and software services to 600 clients worldwide, just signed a contract with General Electric, according to CEO Sunil Wadhwani. "This GE contract could substantially add to our top and bottom lines," he adds. The company has been beating analysts' forecasts in the past five quarters and is expected to do so again in 1998 and 1999. On Oct. 29, Mastech will report third-quarter earnings, which will probably beat analysts' consensus estimate of 18 cents a share, says a New York money manager.
John Mahoney, an analyst at Raymond James & Associates in St. Petersburg, Fla., expects Mastech to earn 68 cents a share this year and 91 cents in 1999, up from 36 cents in 1997. Revenues will jump, he predicts, to $472 million in 1999 from an estimated $368 million in 1998, vs. 1997's $240 million.
Analyst Thomas Neuhaus of Scott & Stringfellow Financial says the stock is a "compelling value, with its strong potential revenue and earnings growth." He notes that Mastech's broad client list--in manufacturing, communications, and technology--will allow the company "to grow through any downturn in any one technology area." Mastech provides such services as client-server design, Year 2000 solutions, and Internet-Intranet programs. "Mastech has the infrastructure to become a $1 billion company by 2002," he says.By GENE G. MARCIALReturn to top
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