Ariba, Legato Ratings Upped by Goldman

Analyst Thomas Berquist expects the companies to post very good results for the December quarter

Goldman Sachs raised its rating on business to business ecommerce companies Ariba ARBA ) and Legato Systems (LGTO ) to outperform from market perform. Analyst Thomas Berquist says he is upgrading the stocks ahead of what should be very good results for the December quarter. He notes that Ariba is to post results Jan. 22 and Legato on January 29.

Along with expected good results, he cites ARBA's stabilizing balance sheet, traction from big-ticket outsourcing products and focus on top and bottom-line growth. He sees fiscal year 2002 earnings per share of $0.07. He also says he would accumulate ARBA up to $10 a share. For LGTO, he cites continued secular strength in storage software and traction with key OEM partners. He sees first quarter earnings per share of $0.19 and 2002 earnings per share of $0.07. He says he would accumulate the stock up to $20 a share.

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