Hi-Tech Pharmacal Co (HITK) estimates are surging following the latest earnings report, which showed earnings rise more than 600%.

Company Description

Hi-Tech makes generic and branded pharmaceuticals, both over-the-counter and prescription. The company focuses on liquid and semi-solid forms for ophthalmic, otic, and inhalable products.

Quarterly Results

On Dec 9 Hi-Tech reported second-quarter results that showed sales increased by 64%, to just under $41 million. This led to a surge in net income, which was up almost 7 fold, to $7.4 million.

Earnings per share came in at 60 cents, 28 cents higher than the Zacks Consensus Estimate. This was the third consecutive earnings surprise.

Estimates Jump

Full-year estimates for fiscal 2010 are now averaging $2.06, up from $1.42 over the past 30 days. This is compared to 78 cents last year.

The Zacks Consensus Estimate for next year is $1.41, while this is lower on a year-over-year basis, it is still almost double last year’s figure.


Shares of HITK are trading at less than 20 times next year’s forecast. The PEG ratio, based on a 5-year growth rate, is under 0.9 times.

Hi-Tech is operating quite efficiently, with a net profit margin of more than 15%, twice the industry average. Its ROE is almost 23%, about 6.5% higher than its peers.

The Chart

Investors piled into HITK following the latest earnings release, driving shares higher. The stock still has plenty of momentum and could continue to rise.

A chart for Hi-Tech Pharmacal CoZacks Growth Trader serviceZacks Investment Research