Shares of Rosetta Stone Inc. surged in late trading Thursday

Shares of Rosetta Stone Inc. surged in late trading Thursday after the maker of language-learning software reported its fourth-quarter profit more than doubled on strong demand from consumers and institutional customers.

Rosetta Stone’s profit and revenue both topped Wall Street expectations, although the company issued profit forecasts for the first quarter and full year that are short of analysts’ estimates. Its revenue forecasts, however, are above Street expectations.

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The company, whose stock debuted in an April initial public offering, said net income for the three months ended Dec. 31 rose to nearly $12.2 million, or 58 cents per share. That’s up from $4.9 million, or 29 cents per share, in the same quarter a year earlier.

Excluding an income tax provision, Rosetta Stone’s per-share profit in the latest quarter was 61 cents per share.

Analysts surveyed by Thomson Reuters had been expecting a profit of 38 cents per share, on average. [Read the full article]

Beginning this week, we’ll share some of the previous week’s best quotes, culled from thought leaders in the world of business, finance, and politics.

The Big Picture: U.S.”As the impetus provided by the inventory cycle is temporary, and as the fiscal support for economic growth likely will diminish later this year, a sustained recovery will depend on continued growth in private-sector final demand for goods and services.”Federal Reserve chairman Ben Bernanke, in testimony before the Committee on Financial Services, U.S. House of Representatives

“I’m afraid that the economy will continue to operate well below its potential throughout this year and next. Even though the recession appears to be over, it does not mean that we are where we want to be.”Federal Reserve Bank of San Francisco president Janet Yellen, in BusinessWeek

“The biggest challenge that the Fed faces is navigating the next financial bubble–under way–caused by the continued low interest rates. [Read the full article]

Shares of Rosetta Stone Inc. jumped Friday morning as a Jefferies analyst upgraded the maker of language-learning software after it reported a strong fourth quarter profit and announced new products that he said should improve future profit margins.

The Arlington, Va., company said on Thursday that its fourth-quarter profit more than doubled, thanks to strong growth in its international business. It also issued a revenue forecast for the first quarter and 2010 year that topped Wall Street expectations.

Jefferies analyst Ross MacMillan upgraded Rosetta to “Buy” from “Hold” and boosted his price target on the share by $5 to $29. He lauded the company’s international performance and said Rosetta’s coming products — the next generation of its language-learning software, which will include subscription services, and a cheaper product for Apple Inc.’s popular iPhone/iPod Touch devices — will help increase recurring revenue and strengthen Rosetta’s business model. [Read the full article]

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