Dynamics Research Corp. (DRCO) shares just received a nice boost after the company released guidance. If the quarterly results, released at the end of the month, are as good as expected the stock has plenty of upside.

Company Description

Dynamics Research Corp. is an innovative solutions provider, partnering with customers to apply proven processes and technologies. The company delivers engineering, logistics and information technology services and precision manufactured products that enhance the performance and cost effectiveness of its customers’ mission critical systems.

Systems built by the company are used for aircraft maintenance and parts tracking, supply chain management, training requirements, and for managing state government health and human services commitments.

A Record Quarter

On Nov 3 Dynamics announced third-quarter results including revenue of $63.5 million, up 9% year-over-year from $58.3 million. Net income was $2.1 million up from $1.9 million on year ago. This yielded earnings per share of 22 cents compared to last year’s 20 cents.

The company booked $103 million in new business contracts, a company record. Management site this amongst other indicators to justify its optimistic view for 2009.

Acquisition Complete

Dynamics completed the acquisition of Kadix systems in August. The company was attracted to the target’s growing business in areas that are not economically sensitive, like defense, public and private health, and others.

Positive Guidance

On Feb 5 Dynamics gave its guidance for 2009 along with its updated forecast for 2008. The company is anticipating revenues between $280 million and $290 million. Dynamics also expects top-line growth of 15-19% and earnings per share between 90 cents and $1. Company estimates represent roughly 18% growth in revenue and earnings.

The Chart

Shares of DRCO remain volatile but have just received a nice boost from the company’s latest guidance. The stock is up dramatically, highlighted by the yellow box below.

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