- Banc of America has added Navteq (NYSE:NVT) to their Top Automotive Stock Picks List saying they believe Navteq's First Call estimates have significant upside potential, driven by the exponential growth/elasticity being experienced in the US portable navigation device end market and the high operating leverage in Navteq's model. Price elasticity in the end market has been running 7x over the last year. Year-to-date sales of portable navigation devices in US are up 300% y/y compared to the 100% growth estimate by the company for 2007. Most of this upside should flow to the bottom line as the company's reinvestment would not be able to keep pace with the revenue growth. We could see some of that as early as the 2Q07, to be announced July 31st.
Maintains Buy and $56 tgt.
Notablecalls: I continue to like NVT. The chart however does not look so hot here! Just keeping the readers posted.
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