Anthony @ Equity Investigations, Dear Anthony, Message Board

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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony,

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To: Anthony@Pacific who started this subject	7/5/2000 6:28:27 PM
From: Softechie	Read Replies (1) of 122087

DLJ on ENTU...Target price $4? ENTRUST TECHNOLOGIES (ENTU: $39 5/8)*+ 7/5/00 Downgrading From Buy to Market Perform Earnings Per Share Old New P/E Ratios (FY:Dec.) 2001E $0.42 $0.39 NM 2000E 0.20 0.13 NM 1999A 0.11 NM Rating: BUY Change: None 12-Mo. Target: $4 <=== YIKE! We are downgrading our rating from a Buy to a Market Perform. The company announced that it has failed to close two large deals in Q2 and would be missing our estimated Q2 revenue figure of $33 million by roughly $3.5 million. We are lowering our Q2 revenue from $33 million to $29.5 million, and our consensus-matching Q2 EPS number of $0.08 to $0.02. Although the two large unclosed deals are expected to close in Q3, we are being cautious about the length of ENTU's sales cycle until we get better visibility on the pipeline. Although the company has not discussed its revised earnings outlook beyond Q2, we are lowering our 2000E from $152 million to $148 million, and reducing our 2001 by roughly 6%. We are decreasing our EPS estimates in 2000 from $0.20 to $0.13, and lowering our 2001 EPS numbers from $0.42 to $0.39. We remain confident of the long-term growth outlook for the PKI industry. However, ENTU's earnings visibility has been negatively impacted and we do not see a substantial short-term catalyst. (9:20 AM ET)

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