Pacific Growth upgraded SAP (SAP ) to overweight.
Analyst Jason Brueschke says the enterprise software maker is well-positioned to benefit from year-end budget flushes, and expects the stock to trade above $40 by the end of 2003. He says the company's third-quarter guidance beat his software license revenue estimate of 394 million euros. Also, SAP sees 1.65 billion euros in third-quarter total revenues, vs. his 1.60 billion euros estimate.
Brueschke says the stronger third-quarter results stem from better closure rates, especially in the U.S., and also from deals closed that were pushed out in the second quarter. For the third quarter, he upped the total revenue estimate to 1.65 billion euros, and boosted the earnings per share estimate to 76 euro cents (22 U.S. cents).
For 2003, Brueschke raised the total revenue estimate to 6.99 billion euros, and upped the earnings per share estimate to 3.58 euros ($1.00).