Compuware Reports 4Q Prelim Results - Analyst Blog
April 04 2013 - 5:40AM
Zacks
Compuware
(CPWR) announced preliminary fourth
quarter results on Apr 3, 2013. For the quarter ended Mar 31,
Compuware expects to report non-GAAP earnings per share (“EPS”) in
the range of 5 cents to 6 cents. Currently, the Zacks Consensus
Estimate is pegged at 16 cents.
Compuware expects total revenue to
be in the range of $237.0 million to $241.0 million for the
quarter. The Zacks Consensus Estimate of revenues currently stands
at $281.0 million. Compuware noted that approximately 75% to 80% of
committed deals for the fourth quarter were pushed to fiscal 2014,
primarily due to uncertain IT budgets and slow recovery in the
European IT spending environment.
Application Performance Management
revenues are expected to be in the range of $76.0 million to $78.0
million, while Mainframe revenues are projected in the range of
$79.0 million to $81.0 million.
Compuware forecasts license fees to
be in the range of $46.0 million to $48.0 million. Maintenance
revenues are expected to be between $99.0 million and $101.0
million. Services revenues are expected to be in the range of $45.0
million to $46.0 million. Covisint revenues are expected to be in
the range of $25.0 million to $26.0 million. Subscription revenues
are expected to be approximately $21 million for the fourth
quarter.
Earlier, in Jan 2013, Compuware
reported impressive third quarter 2013 earnings of 12 cents per
share that surpassed the Zacks Consensus Estimate by 9% (11 cents).
Quarterly results were primarily aided by modest revenue growth and
margin expansion.
Compuware also rejected a $3.2
billion bid from activist investor Elliott Management Corp.
Compuware cited the $11.00 per share offer as inadequate and
announced a number of initiatives that included a dividend payment
for the first time in its history.
Compuware will pay a dividend of 50
cents per share beginning first quarter of fiscal 2014. The company
announced a 3-year restructuring plan that will save $60.0 million
annually. For fiscal 2014, the plan is expected to save a minimum
of $20 million. Additionally, Compuware announced plans to
distribute its remaining shares in Covisint Corp directly to
shareholders after completing the IPO of the 20% Class A stock.
Over the last couple of months,
several new private equity funds, such as Apax Partners LLP and
Hellman & Friedman LLC, have emerged as prospective buyers for
Compuware. Although a better buyout offer will be positive for
investors, we believe that the prevailing sluggish macroeconomic
conditions will likely act as an impediment toward fetching a
higher price.
We believe that Compuware’s
recently announced initiatives are positive for shareholders over
the long term. Moreover, new program wins, innovative product
pipeline and partnership with International Business
Machines (IBM) will help Compuware to
counter strong competition from the likes of BMC Software
Inc. (BMC) and CA Technologies
(CA) going forward.
Currently, Compuware has a Zacks
Rank #3 (Hold).
BMC SOFTWARE (BMC): Free Stock Analysis Report
CA INC (CA): Free Stock Analysis Report
COMPUWARE CORP (CPWR): Free Stock Analysis Report
INTL BUS MACH (IBM): Free Stock Analysis Report
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