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BEA Systems, Inc. fell 7.19 to 46.44 Monday following reports that analysts at Wit Soundview and Prudential Securities issued cautionary notes on the stock.
At Prudential, analyst John McPeake reportedly lowered his price target for the stock to US$85 from $100, while maintaining a strong buy rating.
While BEA is "likely tracking to exceed" analysts' earnings forecasts for the fourth quarter, McPeake wrote, "considering evidence of potential cutbacks in software development projects, we think there is less potential for upside, and think positive revisions are less likely."
At Wit Soundview, analyst Kris Tuttle reportedly slashed his fiscal 2002 earnings estimate for the company to 35 cents per share from 37 cents, citing weak spending on Internet products as dot-com companies and others cut their information-technology budgets.
BEA, which makes e-commerce software, has seen its shares fall along with those of other companies that depend on information-technology spending. Though the U.S. Federal Reserve recently cut its key interest rate in a bid to boost the sagging economy, analysts say it will take some time before lower rates take hold and companies resume spending.
BEA shares are down from a 52-week high of 89.50, but are still well above their 52-week low of 25.50.
BEA, based in San Jose, California, reported third-quarter revenue of $224.0 million, up 77 percent from a year earlier. Pro forma net income rose 200 percent to $31.3 million, or 7 cents per share, from $10.4 million, or 5 cents.
BEA's WebLogic software is used by companies including Aetna, Cisco Systems,
Unibank/MeritaNordbanken and Visa.
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