(CRYP) - Over the past five quarters, exceeded analysts' expectations by an average of 15.4%

CryptoLogic, Inc. (CRYP), a Zacks #1 Rank stock, beat the Street's earnings estimate in the past five quarters by an average margin of 15.4%. Earnings per share are expected to grow 20.0% over the next 3-5 years. Consensus estimates for this year and next are trending higher. The company is currently yielding 2.2% and has a return on equity of 31%, compared to 3% for the industry average. Full Analysis CryptoLogic, Inc. is a software developer in the Internet gaming industry. The company's complete online gaming lineup includes more than 150 casino table and slot games, player-to-player poker and multi-player bingo. CRYP also provides licensing, e-cash management and customer support services. Over the past five quarters in which CRYP exceeded analysts' earnings expectations it did so by an average margin of 15.4%. Earnings per share grew 18.1% over the past five years are expected to grow by a greater magnitude going forward—20.0% over the next 3-5 years. On Aug 3, CRYP beat the Street's estimate by a solid 25.5% when it reported second-quarter profits of $8.2 million, or 59 cents per share. Profits in the prior-year period came in at $4.8 million, or 33 cents per share. Revenues ballooned 52.8% to $30.4 million. President and CEO Lewis Rose stated, "CryptoLogic's new casino games went head-to-head with the World Cup and warm weather—and won. Our Q2 revenue and earnings were far ahead of expectations and surpassed our results in Q1 2006, which is typically a stronger quarter." During the quarter, the company launched 11 innovative new casino games. For the first six months of the year, profits and revenues rose 65.6% and 42.5%, respectively, when compared to the first six months of 2005. The company increased revenues and grew profits for the past three years, most recently by 35.5% and 49.6%, respectively, in 2005. Consensus estimates for this year jumped 10.5% over the past seven days. Profit forecasts for next year have risen 8.8% over the past week. The Board of Directors declared a quarterly cash dividend of 12 cents per common share of stock on Aug 1. CRYP has a current dividend yield of 2.2%. The company is currently trading at a discounted valuation of 11.2x trailing 12-month earnings and at 10.4x current fiscal-year estimated earnings. The market, as represented by the S&P 500, is trading at a valuation of 16.1x trailing 12-month earnings and at 15.4x its current fiscal-year estimated earnings. The company has a price-to-book ratio of 3.3, compared to 4.0 for the market. CRYP's level of profitability, as measured by its return on equity, absolutely obliterates the industry average. The company has a ROE of 31%, compared to 3% for the industry. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. | Blog Home| VitalStocks Home