Wedbush Morgan upgraded FreeMarkets (FMKT) to buy from hold, and set an $8 price target.
Analyst Nathan Schneiderman says FreeMarkets issued disappointing guidance in January, suggesting a sharp drop in the first quarter followed by steadily improving results and a rosy outlook for 2004. He says, while he doesn't expect FreeMarkets will bounce back quickly, he sees some signs of stability in its business, and thinks trends could improve soon.
Schneiderman believes FreeMarkets' planned restructuring action suggested 23 cents 2004 consensus earnings per share estimate, which he thinks is too low; he thinks the company will raise this estimate. Also, he views a recent decline in the stock as a trading opportunity for investors. Schneiderman sees 5 cents 2003 earnings per share, and upped the 30 cents 2004 estimate to 34 cents.