At a time of disappointing Fed interest rate moves, failing retailers, and U.S. recession worries one stock has received an A+ by Wall Street today, the company is MAXIMUS, Inc. (Public, NYSE:MMS). MAXIMUS employees are running around today chanting "MAXIMUS, MAXIMUS!!!" like a scene out of Ridley Scott's Gladiator (can't you imagine Russell Crowe standing on top of their Virgina headquarters?)
Shares of MAXIMUS managed to finish the day up 3% and had the negativity of the DOW not of slammed everything down, I suspect MMS would have closed the day at $41 a share. As is stands, MMS shares are at $39.20 and with the latest analyst saying shares should reach $50, we had to take a look.
Today (12/12) analyst Anurag Rana of KeyBanc Capital Markets upgraded MAXIMUS Inc (MMS) from "buy" to "aggressive buy" and set a 12-month target price of $50. He should have just said "MAXIMUS, my name is Gladiator!"
In a research note published this morning, the analyst mentions that the upgrade in the rating reflects developmental changes over the past 18 months and the current valuation of the company’s stock. MAXIMUS is less dependent than its peers on the Fed government’s discretionary spending, KeyBanc Capital says. There is additional upside potential to the company’s margins in the forthcoming 12-18 months, the analyst adds.
So MAXIMUS the company isn't a blood thirsty gladiator that despises the government, rather they bank coin from governments and charge a hefty premium making them the real winner. MAXIMUS is one of the largest government services companies, provides consulting, enterprise systems and program operations services primarily to government clients.
Since its founding in 1975, MAXIMUS has grown revenue to $700.9 million in fiscal 2006 with contracts in all 50 states. In recent years, the Company has expanded its presence into international markets including Canada, and Australia.
Their Consulting division does financial services, revenue management, systems planning & monitoring, child welfare, and school-based claiming. MAXIMUS helps K-12 schools manage their student information systems and their infrastructure. They implements Oracles’ PeopleSoft Enterprise suite of applications for government and commercial clients. Every quarter this year they have brought in the cash and with Wall Street behind them, they are going to hit $50 a share:
In Millions of USD (except for per share items)
|
3 months Ending 2007-09-30 |
3 months Ending 2007-06-30 |
3 months Ending 2007-03-31 |
3 months Ending 2006-12-31 |
3 months Ending 2006-09-30 |
| Revenue |
201.87 |
196.56 |
179.08 |
161.14 |
171.80 |
| Other Revenue, Total |
- |
- |
- |
- |
- |
| Total Revenue |
201.87 |
196.56 |
179.08 |
161.14 |
171.80 |
You can bet this Stockmaster will be picking up some shares in the near future, it's just too good to pass up. How often does a company get issued an 'Aggressive Buy', I'm planning on buying soon and selling out at $45, why not? With everyone looking for a magic stock I suspect trading will be heavy on MMS to help them recover their losses this week.
Rana said the company sees growth opportunities from the expected expansion of universal health care and a trend among local governments toward outsourcing management of some programs.
