Monotype Imaging (NASDAQ:TYPE) Seems a Bargain Says GARP

Liking what they heard at a meeting with Monotype Imaging's (NASDAQ:TYPE) management at CES, GARP says the company looks like it's a bargain.

GARP said, "After meeting with Monotype’s managers at CES, we are reiterating our recommendation. We think the firm’s web-font & GUI opportunities may be bigger and more immediate than we originally thought. Also, we suspect unit growth in its printer business will remain ahead of the 8% IDC predicts for 2011. TYPE seems like a bargain. It sells for 17x our 2010 EPS estimate (only 10x our 2013 figure), and while it has other interesting opportunities, we think it could push mid-teens EPS growth just from modest secular expansion in laser-printer shipments."

GARP Research maintains a "Buy" rating on Monotype Imaging, which closed Thursday at $12.17, losing $0.32, or 2.56 percent.

ADTRAN (NASDAQ:ADTN) Driven by New Product Categories

After several years of flat sales, GARP Research says ADTRAN (NASDAQ:ADTN) has turned things around in 2010, and are poised to grow as three new product categories shore up the company and its mature products.

GARP said, "After four years of flat sales, 2010 marks an exciting inflection point for ADTRAN. Three new product categories, Broadband Access, Optical Access, and Internetworking, are now meaningfully offsetting a secular decline in the firm’s mature products which represented nearly half its sales in 2009, down from 70% in 2005. We think the US is on the cusp of a multi-year infrastructure upgrade, which will phase out voice-based platforms designed two decades ago and usher in new Ethernet enabled equipment optimized to carry data and video traffic. ADTRAN’s TA5000 multi-service broadband access platform sits at the forefront of this trend.

"ADTRAN typically prices its products at substantial discounts to its large peers—up to 30% in some cases. Remarkably, this has not hurt profitability and its 20%+operating margin is about twice its rivals and rising. Despite this fundamental momentum and a commendable run in 2010, ADTN trades at under 16x our 2011 EPS estimate, and under 12x our 2013 estimate ex. $5.75/sh net cash."

GARP Research maintains a "Buy" rating on ADTRAN, which closed Thursday at $36.38, up $0.17, or 0.47 percent.

Cepheid (NASDAQ:CPHD) Increases Lower End Guidance

During their most recent quarterly report, Cepheid (NASDAQ:CPHD) said they're increasing the lower end of their full year guidance going forward. .

GARP Research commented, "Shares of Cepheid jumped after it reported 2Q10 results. Total revenue grew 21% y/y to $49.6 million, driven by a 41% jump in the clinical segment. This was offset by an expected 35% y/y decline for the Biothreat business, and modest single-digit gains for the Industrial segment...Management raised the lower end of its full year guidance by $5 million to $200-205 million. It considered a modest increase in the top end, but maintained the current level given continued uncertainty in Europe where instrument placements fell 5% y/y during 2Q."

GARP Research maintains a "Buy" on Cepheid, which closed Monday at $21.80, up by $0.50, or 2.37 percent. GARP has a price target of $17 on them.