I've been following digital video technologist SeaChange International
You might even call this thesis central to my entire investment philosophy: I own shares of SeaChange and Netflix
Thus, it's good to see SeaChange delivering on some of its tremendous promise. The stock jumped as much as 6% today after a mighty fine first-quarter report.
The company delivered $0.06 of non-GAAP earnings per share on $52 million of revenue, easily beating the $0.02 per share on $51 million that analysts expected. Citing improved revenue momentum -- also known as higher order volumes -- and more multi-screen software sales, management also raised its next-quarter and full-year guidance.
The multi-screen thing is very important to SeaChange's future. The company has plenty of high-quality competition in plain old on-demand delivery services, including divisions of Cisco Systems
Using recently-introduced SeaChange products, cable companies can serve their programming not only to your living room, but also to smartphones and tablets belonging to paying customers. That personal connection also enables a tailored advertising model, kind of like the personalized text ads that have been Google's
There's more to the SeaChange story, including a social media component and a digital retailing solution. Long story short, there's a reason why Wall Street analysts expect SeaChange to grow earnings by an annualized 46% over the next five years.
The market opportunity for VOD products is fantastic, as detailed in this free Fool report on the top stock to get in 2011. SeaChange is primed for success. Is this the turning point where SeaChange stops walking and starts running? Or perhaps a lead-in to yet another buyout in the VOD sector? Arris was supposed to make a bid for SeaChange last week, but that rumor has yet to become reality. Add the stock to your watchlist, and you'll be the first to know.