CA Technologies (CA): Anti Trust Should Not Prevent CA/BMC Merger - Bernstein
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Bernstein analyst, Mark Moerdler, reiterated his Underperform rating on shares of CA (NASDAQ: CA) despite rumors about a possible acquisition by BMC Software. While the two companies were once dominant in the systems management industry, the analyst notes that CA and BMC have 7.5% and 8% share respectively as of FY16 which combined would put them on a near even footing with IBM, the largest vendor, at 15%. There are also many other vendors in the market including MSFT (7%) and NOW (5%) so anti trust concerns should not be an issue.
On the flip side however, he believes that BMC acquiring CA could be incrementally positive for Splunk (NASDAQ: SPLK) and ServiceNow (NYSE: NOW) as each could take share during any disruption. No change to the below market price target of $28.
Shares of CA closed at $34.62 yesterday.
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Related EntitiesSanford C. Bernstein, Definitive Agreement
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