Phase Forward Inc. (PFWD) earlier announced that it would repurchase shares worth $40 million over the next twelve months in the open market.
The company expects to use cash on hand and cash generated from operating activities to fund repurchases of its common stock. Management believes that share repurchase is an attractive use of capital given its strong balance sheet along with increasing shareholder value. At the end of third quarter, the company had total cash, cash equivalents and investments of $147.2 million.
The company also announced a multi-year agreement with Quotient Clinical, which specializes in development services for a broad range of pharmaceutical and biotech customers.
Quotient Clinical is a business unit of Quotient Bioresearch and the company is currently implementing Phase Forward’s InForm Global Trial Management (GTM) electronic data capture (EDC) solution to support data collection, management and analysis for its clinical trials. By supporting faster accessibility and greater visibility into trial data, the EDC implementation will help Quotient to expand its in-house Biometrics offering. In addition, Quotient plans to offer customers on-line access to trial data, making it easier for them to track progress to date or to review summary reports.
Earlier, profitability declined 50% in the third quarter for the company but beat Wall Street expectations.
Management guided revenues between $58.0 and $59.5 million in the fourth quarter of 2009. Earnings per share are projected around 5 cents – 6 cents. For 2009, the company guided revenues between $215 million and $216.5 million. Earnings per share are projected around 50 cents – 51 cents.
We believe increasing adoption of EDC will benefit Phase Forward, and that the company’s product breadth could allow it to gain market share, allowing it to grow at above market rates, leading to positive revenues and earnings surprise and revisions.
Headquartered in Princeton, New Jersey, Phase Forward is a leading provider of data management solutions for clinical trials and drug safety.
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