- The Washington Times - Monday, January 30, 2006

Micros Systems Inc., an information technology provider for the hospitality and retail industries, continuing its strong growth, Thursday announced a deal with DavCo Restaurants, the largest franchiser of the Wendy’s fast-food chain with more than 150 locations.

Also on Thursday, the Columbia-based IT company reported second quarter earnings of $15.8 million, or 39 cents per diluted share — a 34-percent surge compared with $11.8 million, or 30 cents, a year ago.

“This is an extremely strong buy,” said Alan Weinfeld, an analyst with Kaufman Bros. of New York, which does not own any shares of Micros Systems or do banking with the company.

“We are pleased with the financial results for the quarter … and the number of new contracts signed to that date, including those long-term contracts with deployments over the next year and beyond,” said Tom Giannopoulos, chairman and chief executive officer of Micros Systems.

Shares of Micros Systems, which provides hardware and software applications — such as reservation systems — to restaurants, hotels, stadiums and theme parks, closed at $46.15 yesterday.

On Thursday, the company reached a 52-week high of $55.33 but slipped $6.41 Friday to close at $48.92 before slipping more yesterday.

Mr. Weinfeld dismissed the price fluctuations following the company’s earnings announcement as “just an aggressive overreaction.”

“Some people like to buy on the rumor and sell on the news,” he said. “People were anticipating something much bigger than they got and clearly the stock was overbought — it shouldn’t have got that high in the first place.”

Micros Systems is an attractive stock for long-term investors, Mr. Weinfeld said.

“The company maintains a solid pipeline of new business in both the hotel and restaurant business,” Daniel Perlin, an analyst with Stifel, Nicolaus & Company Inc. in Baltimore, wrote in a research report. Stifel Nicolaus has an investment-banking relationship with Micros Systems.

During the company’s second quarter, which ended Dec. 31, Micros Systems signed new contracts with Hilton Hotels and Carlson Hotels, worth around $3 million over the next three to four years, according to Mr. Perlin. (As a policy, Micros Systems does not disclose contract amounts.)

Mr. Weinfeld said Micros Systems has an advantage over its competitors because it is a full-service IT provider.

“The competitors are small. They don’t do everything, certainly not on the same scale across the world, and it could be that half of [Micros Systems] deals went on vendor viability,” he said. “When you make a choice on a [vendor] for five or seven years, you need to know that vendor’s going to be around to serve you” or provide “an upgrade for a better system seven years down the road.”

For the third quarter ending March 31, the company’s guidance calls for net income between $15.5 million and $16.5 million. Net income for the same period of 2005 was $14.2 million.

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