ReachLocal Reports Profit SurpriseWednesday, August 1, 2012
Shares of ReachLocal Inc. rose nearly 7 percent on Wednesday after the provider of online marketing services for small and medium businesses reported second-quarter profit and revenue growth topping analysts’ expectations.
Net income jumped 134 percent to $332,000 (1 cent a share) for the Woodland Hills company, with revenue up 21 percent to $112 million. Analysts had expected a loss of 2 cents a share on revenue of less than $110 million.
Imperial Capital analyst Anil Gupta liked the company’s execution of its domestic and international growth strategy, but reduced the stock rating from “buy” to “inline,” primarily due to its current high valuation.