RBC Capital Cuts Cognos to Sector Perform from Outperform
RBC Capital downgraded Cognos (COGN ) to sector perform from outperform, explaining that the company's large third quarter shortfall was a blow to investors after its first quarter miss and previously lowered second quarter guidance.
Analyst Mike Abramsky says the company failed to convert an "ample" pipeline of large, standardized deals, while struggling with transitions. He cut his 39 cents third quarter earnings per share estimate to 31 cents and his $1.80 fiscal year 2007 (ending February) earnings per share estimate to $1.50 with 9% license growth. He says that his revised $33 target, down from $42, is inline with peer averages and he expects valuation to remain rangebound.