Oppenheimer is maintaining its Perform rating on shares of Ritchie Bros. Auctioneers RBA “as we await sustained GAP reinvigoration given RBA's trading multiple of 37x our 2011E EPS of $0.68 (+10% y/y).”
“We recently met with COO Bob Armstrong, who views RBA's 2011 start as improved y/y, but is proactively cautious in extrapolating upside to 2011,” Oppenheimer writes.
“Specifically, early-1Q10 auctions were strong, prompting ambitious 2010 guidance that went unfulfilled. To date, 1Q11 is even better, though RBA stressed that it is remaining purposely unambitious regarding 2011 guidance.
“It appears that favorable initial 1Q11 auction activity (e.g. GAP/gross auction proceeds at RBA's major Orlando auction were +25% y/y) has remained strong post RBA's (2/24/11) 4Q10 call.”
Ritchie Bros. Auctioneers closed Wednesday at $24.85.
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