PRGN ( $21-25) PeopleSoft, Peregrine Shares Rise on Strong Earnings
NEW YORK (Reuters) - Shares of software companies Peregrine Systems Inc. (NasdaqNM:PRGN - news) and PeopleSoft Inc. (NasdaqNM:PSFT - news) rose sharply on Wednesday, a day after both firms posted solid earnings gains and reiterated financial guidance for the rest of the year.
Shares of San Diego-based Peregrine soared 19.44 percent, up $4.16, to $25.60. PeopleSoft rose 6 percent, or $2.06, to $36.27.
The companies' good news came amid a flurry of depressing earnings releases from other software firms, including i2 Technologies Inc. (NasdaqNM:ITWO - news), Commerce One Inc. (NasdaqNM:CMRC - news), Ariba Inc.(NasdaqNM:ARBA - news), Compuware Corp. (NasdaqNM:CPWR - news) and BMC Software Inc. (NYSE:BMC - news).
After the markets closed on Tuesday, PeopleSoft, which makes software that lets companies automate their business processes, posted second-quarter earnings from recurring operations up 188 percent at $46 million, or 14 cents a share, compared with $16 million, or 6 cents a share, a year earlier.
Analysts polled by Thompson Financial/First Call, on average, expected PeopleSoft to post a profit of 12 cents a share. License revenue also was higher than expected, jumping 51 percent from a year earlier, to $166.3 million.
Excluding acquisition-related charges, Peregrine -- a maker of a range of software from systems management to electronic business products -- reported earnings of $19.5 million, or 12 cents a share, for its fiscal first quarter, compared with $12.1 million, or 10 cents a share, a year ago. The earnings beat analysts' estimates by 2 cents, according to First Call.
In addition, Peregrine reaffirmed its guidance for the full year -- the company's fiscal 2002 -- saying it expects earnings to be up 25 to 35 percent from last year's 53 cents a share. It said revenues would increase 30 to 40 percent from fiscal 2001's $564.7 million.
For fiscal 2002, analysts' consensus earnings forecast is 68 cents a share, with estimates ranging between 66 cents and 70 cents, according to First Call. The consensus revenue forecast is $795.6 million, according to First Call.
PeopleSoft Chief Executive Craig Conway told analysts the software maker's third-quarter license revenue and earnings would be up from the second quarter, and he reiterated the company's forecast for full-year earnings of 55 to 60 cents a share and license revenue growth of ``slightly over'' 35 percent.
Conway also said the company was comfortable with Wall Street's consensus earnings estimate for the fourth quarter of 19 cents a share.
The news prompted brokerage firm Salomon Smith Barney to raise its on PeopleSoft shares to ``buy'' from ``outperform'' and to increase its earnings estimate for the third quarter to 15 cents from 14 cents.
``Second-quarter 2001 results reiterate our thesis that PeopleSoft can outperform in the current environment,'' analyst Gretchen Teagarden said in a research note. She cited what she called the company's superior Web architecture, as well as its new customer-relationship-management software, limited exposure to a slowdown in Europe, and large customer base.
Bear Sterns reiterated its ``buy'' rating on Peregrine and said it was leaving its fiscal 2002 earnings per share estimate unchanged.
``We believe Peregrine's consistency stems from a diversified portfolio of 100 products, a pragmatic value proposition, and guidance that had anticipated the general weakness now in evidence,'' analyst David Breiner said in a research note. |
