From Standard & Poor's Equity ResearchOPPENHEIMER REITERATES PERFORM ON ULTIMATE SOFTWARE GROUP
Oppenheimer analyst Brad Reback says Ultimate Software Group (ULTI) posted solid fourth quarter results: $0.11 EPS, $49.7 million revenue topped Street's $0.10, $48.8 million view.
Reback notes that the upside came from healthy recurring revenue growth, better-than-expected license sales. Nevertheless, he notes ULTI decided to cut its 2009 guidance and stop selling its solutions on a perpetual license basis.
While he believes ULTI's long-term fundamentals remain healthy, the change in its business model will benefit the company in the long term. He slashes his $0.55 2009 EPS estimate to $0.28, and says he would wait for a better entry point.
THINKEQUITY UPGRADES SYNCHRONOSS TECHNOLOGIES
ThinkEquity analyst Eric Kainer says Synchronoss Technologies (SNCR) posted fine fourth quarter results and notes that the company is rolling out two evocative programs, one with Dell (DELL) for connected laptops and the other with CruiseCase for mobile TV.
Kainer sees each as an early manifestation of bigger future businesses. Also, he believes new programs at Sprint (S) and AT&T (T) reinforce more positive views for 2009 and beyond.
He upgrades the stock to accumulate from source of funds, and raises 2009 revenue/EPS view to $123 million/$0.50 from $121 million/$0.40, and lifts his $9 price target to $10.
WEDBUSH CUTS SKECHERS TO HOLD FROM BUY
Skechers U.S.A. (SKX) sees fourth quarter loss of $0.45-$0.50 on sales of $290-$300 million. Wedbush analyst Jeff Mintz says he was looking for fourth quarter EPS of $0.10.
He believes inventory issues present significant problems, as the company expects inventory to be $250-$260 million at fourth quarter-end, up from $204 million at the end of fourth quarter 2007, despite inventory write down of around $12 million.
He says he skeptical that the company can work through excess inventory in the first half of 2009 without further write downs. He doesn't think SKX provided an explanation for increased inventory levels, which suggests it is due to lack of strong inventory management.
He cuts $1.71 2008 EPS view to $1.12 and $1.35 for 2009 to $0.31. He slashes $14 price target to $6.50.