Nautilus climbs on better-than-expected sales results

Nautilus Inc.'s stock soared Tuesday after an analyst upgraded the company, encouraged by better-than-expected first-quarter sales and cost control efforts.

Reed Anderson of D.A. Davidson said in a client note that Nautilus' sale of Pearl iZumi sportswear and initial cost cutting efforts have strengthened its balance sheet, putting the owner of fitness equipment brands StairMaster and Bowflex in position to possibly finish the year with little or no debt and positive cash flow.

Late Monday the Vancouver, Wash.-based company said its quarterly revenue dropped to $129.6 million from $137 million, but the results topped the $121.2 million estimate of analysts surveyed by Thomson Financial.

Anderson raised his rating to "Buy" from "Neutral" and lifted his price target to $7 from $4.25.

Wedbush Morgan Securities' Rommel Dionisio was also pleased with sales, saying the company's brand strength, Bowflex equipment and international operations helped its performance.

The analyst reiterated a "Buy" rating and $6 price target.

Shares of Nautilus rose 76 cents, or 16.6 percent, to $5.33. Over the past year, the stock has traded in a range of $3 to $13.77.