FLIR Systems (NASDAQ:FLIR): Positioned for significant potential increases in both 2008 revenue and EPS estimates - SunTrust

- SunTrust is out with an interesting call on FLIR Systems (NASDAQ:FLIR) saying that last week, the U.S. Army posted a modification to its pending Forward Activity Detection System (FADS) program that could substantially increase the scope of this program from a 5,000-system, 1-year procurement to a potential 17,800-system, 5-year program to supply a new infrared-based Driver's Vision Enhancer - Family of Systems (DVE-FOS), replacing many of the DVE systems currently deployed by the military. Although DRS Technologies is the incumbent supplier of this system to the Army, they believe FLIR is very well positioned to aggressively compete for this program based on the success of its currently fielded DVE systems used in the commercial automotive and trucking industries.

According to the firm, FLIR is likely pursuing several large programs of which DVE-FOS is only one. They view DVE-FOS as a substantial upside opportunity to go along with G-BOSS, VOSS, and SBINET. Firm believes FLIR is favorably positioned to win at least one of these large opportunities (G-BOSS in particular), leading to significant potential increases in both 2008 revenue and EPS estimates, and reiterate Buy rating and $42 tgt.

Notablecalls: Interesting comments buy SunTrust's Chris Donaghey. Expect to see some buy interest in FLIR today.

Hartford Financial (NYSE:HIG): Several firms defending

Several tier-1 firms are defending Hartford Financial (NYSE:HIG) following last night's conservative guidance:

- Citigroup notes that despite an initial 2008 guidance range ($9.80-$10.20) which was lower than the Street's $10.51, they would expect that based on history, guidance will rise over the course of 2008 (barring a large unexpected asbestos charge or significant hurricane activity in 2008).

They are inclined to believe that management tends to set the operational bar at a very achievable level. A detailed analysis of earnings surprise history suggests likely EPS outperformance in 2008. Since 1997, the company has reported earnings beat 64% of the time. Firm notes that the average quarterly EPS surprise is $0.10/share since 1997.

When HIG announced its 2007 estimates back in Dec 2006, the stock dropped to the $85-86 range only to achieve more than 20% upside in the six months to follow. Shares declined 3% on Friday in advance of the guidance as short-term traders expected a low guidance range.