DB Alex. Brown Cuts i2 Rating

Analyst James Moore says the software firm's visibility remains low as mega-deals fall back

DB Alex. Brown downgraded and cut estimates on shares of i2 Technologies (ITWO ).

Analyst James Moore says with the majority of New Economy mega-deals exhausted and a portion of deferred-revenue backlog being drained, he thinks visibility for i2 remains low. He cut the $0.21 2001 EPS estimate to a $0.05 loss, and cut the $0.41 2002 estimate to $0.20.

Not surprisingly, he says the number of larger deals over $1 million fell from 50 in Q4 to 29 in Q1. In light of the risks facing i2 over the next few quarters, the stock's relatively high valuation (shares trade at seven times his 2001 revenue estimates), Moor downgraded i2 to market perform from buy.

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