ShotSpotter eyes worst day after 2019 rev forecast cut, analyst downgrade

Soundthinking

10/05/2019 18:07

** Shares of gunshot detector  SSTI.O  plunge 16.4% to
$45.88 - biggest one-day pct fall after co cuts 2019 revenue
forecast, brokerage downgrade
    ** Dougherty & Co cuts rating on stock to "neutral" from
"buy" and removes PT
    ** "While we continue to love the ShotSpotter story on a LT
basis, we recognize that a 75% YTD run in the stock combined
with a modest reduction to revenue guidance is bad combination
for a SaaS stock," - analyst Jeremy Hamblin
    ** Expects investors to revalue the stock lower and take
some time to assess the risk of additional contract attrition,
which brokerage believes to be low
    ** Lowers FY19 and FY20 estimates and believes multiple
assigned to the stock is likely to linger lower until at least
Q3 or until new catalysts are found
    ** SSTI misses Q1 revenue estimates, cuts 2019 revenue
forecast range to $44.5 mln-$45.5 mln from $45 mln-$47 mln,
below analysts' est. of $46.1 mln  urn:newsml:reuters.com:*:nL3N22L5PF
    ** Co blames forecast cut on loss of a major customer and
delays in contract negotiations with two potential customers
    ** Current avg. rating on stock is "buy"; median PT $55
    ** Including session's losses, SSTI still up ~47% YTD and
has risen more than 300% over its 2017 IPO price of $11

 (Reporting by Arjun Panchadar in Bengaluru)
 ((RM: Arjun.Panchadar.thomsonreuters.com@reuters.net))