), an old-line tech outfit that makes point-of-sale terminals, ATMs, and data-warehouse systems. Wal-Mart (WMT
) and Home Depot (HD
) use its data systems. NCR shares bolted from 35 last December to 52 on Oct. 27. For six quarters, NCR posted happy earnings surprises as demand kept on rising. And on Oct. 12, it announced it would beat third-quarter estimates -- prompting analysts to lift forecasts. In spite of the stock's steep rise, some pros see room to run.
Matt Summerville of KeyBanc Capital Markets expects it to hit 65 in 12 months, rating NCR an "aggressive buy." Servicing customers' ATMs and cashier terminals is a field ripe for growth, Summerville says. Customer service brings in a third of revenues but is still unprofitable. NCR says it now focuses on servicing customers that use products where the margins are high. NCR's ATMs and data warehousing systems should also yield "solid growth over the next several years," he predicts. He has upped his earnings estimate for 2004 from $1.27 a share to $1.49, and for 2005 from $1.95 to $2. Richard Farmer of Merrill Lynch (MER
), which does business with NCR, has also raised his numbers -- and rates the stock a buy. He sees sales of $5.8 billion in 2004 and $6 billion in 2005, vs. $5.6 billion in 2003.Note: Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them. See Gene on Fridays at 1:20 p.m. EST on CNNfn's The Money Gang.