Microstrategy reports better than expected revenues. Are they turning the corner? Anyone here hold them or have an opinion?
biz.yahoo.com
Article with some interesting analysts opinions:
MicroStrategy shares gain after Q2 earns beat estimates
By Adam Pasick
biz.yahoo.com
NEW YORK, Aug. 1 (Reuters) - Shares of business intelligence software maker MicroStrategy Inc (NasdaqNM:MSTR - news). climbed more than 17 percent on Wednesday, a day after the company beat analyst earnings expectations for the second quarter.
McLean, Virginia-based MicroStrategy shares reached a high of $4 from Tuesday's close of $3.24, and were up 65 cents at $3.89 in late Nasdaq trading. The stock was among the top percentage gainers on the Nasdaq exchange.
The share has traded in a 52-week range between $1.75 and $38.8125.
The company makes software that helps businesses sift through large stores of data, competing with companies like Business Objects SA (NasdaqNM:BOBJ - news) and Cognos Inc (Toronto:CSN.TO - news).
``There's a few things that suggest the ship is steadying itself,'' said First Albany Corp. analyst Mark Murphy, citing a sequential revenue gain from the first quarter.
On Tuesday, MicroStrategy posted a second-quarter pro forma operating loss of $9.8 million, or 12 cents per share. The company said in April it expected a loss of 15 cents to 19 cents; analysts on average expected a loss of 16 cents, according to Thomson Finanical/First Call.
The legacy of MicroStrategy's past accounting troubles -- the company has lost billions in market capitalization since it restated earnings last year, sparking a host of shareholder lawsuits -- could be seen in the second-quarter earnings statement, analysts said.
``It's mind-wrenchingly complex from an accounting standpoint,'' said Wells Fargo Van Kasper analyst Robert Tholemeier.
The company provided a torrent of information, breaking out separate balance sheets and quarterly results for its core operations and for its majority-owned Strategy.com subsidiary.
Excluding Strategy.com, MicroStrategy broke even on an EBITDA, or earnings before interest, tax, depreciation and amortization, basis, and said it would break even on a pro forma basis by the end of 2001.
``Strategy.com is still a thorn in their side,'' said Friedman Billings Ramsey analyst David Hilal. ``They need to do something to free up that cash for their shareholders.''
Despite its relatively strong second-quarter results, some analysts were doubtful the company has truly turned things around.
``At one level, the company did better than its own previously reduced expectations, but what they're trying to do in the (business intelligence) space doesn't make sense,'' said Josephthal & Co. analyst Bert Hochfeld.
He said MicroStrategy's software may require too much customization and effort to be cost-effective.
``This is a company that offers a very powerful solution that takes huge amounts of time and effort to implement,'' he said. ``Even in good times, it probably was wrong -- but now it's exactly what people don't want to do.'' |
