Shares of middleware provider BEA Systems Inc have had a bumpy ride recently, leading to speculation that the company’s results for the April quarter will be less than pretty. Analyst Wendell Laidley at Deutsche Morgan Grenfell’s technology group feels there’s no cause for alarm, however. Laidley says his research indicates that the Sunnyvale, California company should post another solid quarter in line with, or better than, DMG’s estimates of $52m in revenues and earnings per share of $0.05. Recent rumors have included venture capital selling by SBC Warburg, a delay in the launch of the Iceburg product, exposure to the new accounting rules for the recognition of software revenues and fallout from Microsoft Corp’s competitive posturing on middleware. Laidley asserts that none of the stories is true, and says if the company had missed consensus, we believe it would have pre-announced by now. Given that, he figures the decline in stock price – it has fallen about 35% since late March – seems attributable to aggressive profit taking and multiple- related concern, particularly given the significant appreciation in BEA’s stock price through March. DMG has reiterated its buy rating on the stock and its price target of $33. Also on Friday, Dain Rauscher Wesels upgraded BEA to strong buy-aggressive from buy and said it believed the company could achieve a long-term growth rate of 60%. The support helped BEA shares to jump $2.2813, or nearly 12%, to close at $21.406.
