Internet consulting firm MarchFIRST (Nasdaq: MRCH) rose US$1.28 to $3.16 Monday following reports that Credit Suisse First Boston resumed coverage of the stock with a buy recommendation. In early trading Tuesday, the stock was trading at $3.20.
As the demand for Internet services has fallen off, MarchFIRST has seen its shares fall in recent months, along with the stock prices of its competitors. The company’s stock is down from a 52-week high of $56.50, set in January 2000.
Credit Suisse’s Mark Wolfenberger reportedly put an $8 per share price target on Chicago, Illinois-based MarchFIRST, saying the company’s cost-cutting plan, along with a recent cash infusion, will help it survive the dot-com shakeout.
In November, to deal with the downturn in business, MarchFIRST announced a restructuring plan that included 1,000 job cuts. The plan,designed to save about $100 million a year, reduced the company’s workforceby 10 percent.
MarchFIRST’s third-quarter earnings, issued before the cost-cutting plan wasenacted, were a disappointment. The company reported income excluding extraordinary items of just a penny per share, instead of the 20 cents that had been expected byWall Street analysts. The company said then that a weak environment for e-commerce services and adeclining euro put pressure on the results.
In December, the company received an additional boost in the form of $150 million infinancing from Francisco Partners, a private equity firm.
David Stanton, a partner and founder of Francisco Partners, said at the timethat MarchFIRST’s “experienced management team, talented professionals,breadth and depth of service offerings, strong client base and proven trackrecord” should help the company “become a long-term leader” in the e-servicesmarketplace.