Tech Industry

Strong 2Q growth boosts Hoover&#039s shares

Online financial information provider Hoover's Inc. (Nasdaq: HOOV) shot up 1 5/8, or 15 percent, to 12 7/16 Wednesday after reporting a substantially smaller-than-expected loss in its second quarter.

The Austin, Texas-based firm lost $3.3 million, or 29 cents a share, on sales of $3.8 million in its second quarter

First Call consensus expected it to lose 39 cents a share in the quarter.

In the year-ago quarter, it lost $903,000, or 18 cents a share, on sales of $2.1 million.

Company officials said its advertising sales jumped a staggering 476 percent increase in the quarter while its total subscriptions revenue rose 65 percent.

"As a result of our continuing strong growth in advertising, e-commerce, and sponsorship revenue and our accelerating growth of higher margin enterprise accounts, we made solid progress toward realizing our long-term operating model," said CEO Patrick Spain in a prepared release. "Gross margins for the current quarter were 56 percent of revenue compared to 54 percent and 32 percent of revenue for the prior quarter and year ago periods.

In its July initial public offering, Hoover's shares soared as high as $33 a share before plunging below $9 a share in less than a month. The stock made a slight rally to get back above $17 a share in September before slipping back to around $10 a share.

All four of the analysts following the stock maintain either a "buy" or "strong buy" recommendation.