UBS Financial initiated coverage on BearingPoint (BE) with buy.
Analyst Adam Frisch says his positive view reflects operating leverage opportunities that could result from an improvement in discretionary information-technology services demand (95% of BearingPoint's revenues.) He says his proprietary scenario analysis supports a potential significant growth opportunity in 2005.
Frisch believes the market will reward BearingPoint when additional evidence of an overall market rebound becomes apparent. He thinks the business and technology consulting firm offers a favorable risk/reward profile, as it has been resilient after suffering some weakness following a disappointing June quarter and a mixed September quarter.
Frisch sees 34 cents fiscal 2004 (June) earnings per share, and 60 cents in fiscal 2005. He set a $12 target.