) to buy from hold. Marvel reported second-quarter EPS of 42 cents, vs. 10 cents, on 27% net sales rise. The comic book publisher sees third-quarter EPS of 25 cents to 30 cents, and raised 2003 EPS outlook to $1.26 to $1.31 and sees 96 cents to $1.14 in 2004 EPS.
Analyst Bill Lennan tells S&P MarketScope that Marvel's results were well ahead of his 27-cents and consensus 31-cents estimates. He says the upside was driven by strong performance of licensed products (toys, apparel, etc.) based on The Hulk. He was more impressed with the company's guidance because there was uncertainty as to where the company would guide for 2004.
He says management guided to 96 cents to $1.14 in EPS on $315 million to $345 million in revenues for 2004. He notes the guidance is pleasing the market, and clarity regarding 2004 film releases are erasing some of the hangover, which held MVL below $20 recently.
Lennan raised his EPS estimates from $1.13 to $1.26 for 2003, and from $1.05 to $1.11 for 2004. He increased his $21 stock price target to $25.