ASDV article from Bloomberg. Soundview reiterated a strong buy during the day. Looks oversold to me.
Aspect Development Falls After 1st-Qtr Profit Warning (Update3) (Adds company comment in 6th through 8th paragraphs. Updates shares.)
Mountain View, California, April 5 (Bloomberg) -- Aspect Development Inc., which makes product-management software, fell as much as 67 percent after it warned first-quarter profit and revenue will lag expectations because it didn't win several large contracts it was counting on.
The company's shares fell 14 17/32 to 7 7/8 in late trading of 14 million, making it the seventh most actively traded stock in U.S. markets. The shares earlier touched 7 1/2.
Aspect expects a $2 million to $3 million loss from operations, Chief Financial Officer David Dury said. The company was expected to earn 12 cents a share, the average estimate of analysts surveyed by First Call Corp. Revenue is expected to $14 to $15 million, the company said on Friday.
The maker of software that helps manufacturers in the automotive, aerospace and other industries buy parts and build products also expects revenue to increase at a slower pace the rest of the year. Aspect is revamping its sales force so that it can compete for a better mix of small and large contracts. ''They got too focused on a fairly narrow set of opportunities,'' said Christopher Mortenson, an analyst with BT Alex. Brown Inc., who lowered his rating to ''market perform'' from ''buy.''
Aspect was counting on three large contracts for two-thirds of its business, Mortenson said. The sales all fell through, though the company expects to still compete for them, he said.
The Mountain View, California-based company has been negotiating the contracts for several months, Dury said. Each one is worth several million dollars, he said. ''It was literally the last day of the quarter that we were still expecting the deals to close,'' Dury said. ''In previous quarters, we had a much broader diversity of deals to choose from.''
The company sees no weakness in demand because of competition or the Year 2000 problem, Dury said.
The Year 2000 computer glitch causes some older computer programs to read the year 2000 as 1900. Corporations have slowed spending on software to fix the problem, hurting sales at some software companies such as PeopleSoft Inc. ''Ultimately, they are blaming their own execution,'' said Jim Mendelson, an analyst with SoundView Technology Group.
In the 1998 period, Aspect earned $2.3 million, or 17 cents a share, on revenue of $17.7 million. It expects to break even or have profit of $1 million after including a $3 million gain from a joint venture.
Aspect expects to have a profit for each of the remaining quarters of the year. |
