Jefferies Gives ‘Buy’ Rating to Telvent (TLVT)

Telvent GIT SA TLVT is likely to benefit from steady bookings momentum and a better outlook in transportation. The company recently reported its first quarter earnings numbers which were largely in-line with estimates. Its Q1 revenues were down 1% y/y organically. The company's energy business showed 7% y/y growth while the transportation unit continued its downward slide. Telvent (TLVT) also increased its margins by 50 bps y/y. The company has solid future bookings as well as a growing backlog which is up 16% y/y. According to a recent report released by Jefferies & Co., Telvent management's commentary regarding 85%+ visibility into its 2010 guidance underscores its recurring revenue based business model. Telvent has been given a “Buy” rating with a price target of $30, which is a 15x multiple of 2010E EPS.