Wedbush Morgan cut its estimates on Blue Coat Systems (BCSI).
Analyst Kevin Trosian says the 20 cents fourth-quarter non-GAAP earnings per share came in below his 24 cents estimate, but revenues of $21.1 million beat his $20.6 million estimate. Although the web-security solutions provider beat his revenue estimates, Trosian says he thinks investors were expecting revenues to reach $22 million to $23 million, and earnings per share to beat estimates by 1 cent to 2 cents.
As such, he believes investors are expecting too much and that expectations should be tempered, given the early stages of a turnaround at the company. He trimmed the 99 cents fiscal 2005 (Apr.) earnings per share estimate to 98 cents, but upped the $90 million fiscal 2005 revenue estimate to $101 million.
Trosian cut the $43 target to $29. Trosian maintains his hold rating, with Blue Coat poised for growth as companies shift their focus to internal security.