Piper Jaffray Comments On Valassis Communications Ahead Of Earnings

Piper Jaffray remains buyers of Valassis Communications VCI in front of its Q4 earnings release on Feb. 17th. While Piper does not anticipate the company will revise its recent FY11 guidance upward, it expects the stock, which has underperformed the S&P by ~10% since issuing guidance, will find reprieve from discussion of FSI pricing stability and progress on the new shared mail sales strategy. When the company's $193M share repurchase basket opens Piper would not be surprised to see the balance completely exhausted at or below current share prices. Piper Jaffray expects Q4 revenue and adjusted GAAP EPS of $637.5M and $0.60, respectively. Note, Piper's EPS estimate reflects adjusted EBITDA of $89.6M, which equates to FY10 adjusted EBITDA of $326.6M, and roughly $6.6M above the company's $320M adjusted EBITDA guidance. Piper Jaffray has an OW rating on VCI VCI closed Tuesday at $32.37