Canaccord Genuity Maintains a 'Hold' on Pegasystems (PEGA); Bounce-Back Qtr, But Shares Still Expensive
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Price: $33.56 -0.15%
Rating Summary:
11 Buy, 11 Hold, 0 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
11 Buy, 11 Hold, 0 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Canaccord Genuity maintains a 'Hold' on Pegasystems (NASDAQ: PEGA) price target of $32.00.
Analyst, Richard Davis, said, "Pegasystems reported strong Q4 bookings, an in-line 2012 revenue outlook, and back-end-loaded EPS guidance that implies modest 11% operating margin expectations. PEGA shares likely will be a great investment if the firm eventually generates operating leverage. If not, the stock will ebb and flow based on when investors chase growth at any price versus growth at a reasonable price. We came close to reinstating the BUY rating that we withdrew last summer, but given that the 2012 outlook is so back-end-loaded we decided that we have time to do some more fundamental work to reach a reasoned conclusion as to whether the half dozen next-generation tools companies we've met with recently with go-to-market models that are low price, low services, digital fulfillment focused are an
emerging threat to PEGA's growth prospects (all of those companies range in
revenues from $50-150M and are growing in excess of 50% annually). So, we
think this was a very solid quarter, but we simply want to be more confident of
the firm's outlook before getting back on the PEGA bus. We’ll stay at HOLD for
now."
For an analyst ratings summary and ratings history on Pegasystems click here. For more ratings news on Pegasystems click here.
Shares of Pegasystems closed at $28.08 yesterday.
Analyst, Richard Davis, said, "Pegasystems reported strong Q4 bookings, an in-line 2012 revenue outlook, and back-end-loaded EPS guidance that implies modest 11% operating margin expectations. PEGA shares likely will be a great investment if the firm eventually generates operating leverage. If not, the stock will ebb and flow based on when investors chase growth at any price versus growth at a reasonable price. We came close to reinstating the BUY rating that we withdrew last summer, but given that the 2012 outlook is so back-end-loaded we decided that we have time to do some more fundamental work to reach a reasoned conclusion as to whether the half dozen next-generation tools companies we've met with recently with go-to-market models that are low price, low services, digital fulfillment focused are an
emerging threat to PEGA's growth prospects (all of those companies range in
revenues from $50-150M and are growing in excess of 50% annually). So, we
think this was a very solid quarter, but we simply want to be more confident of
the firm's outlook before getting back on the PEGA bus. We’ll stay at HOLD for
now."
For an analyst ratings summary and ratings history on Pegasystems click here. For more ratings news on Pegasystems click here.
Shares of Pegasystems closed at $28.08 yesterday.
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