There's much concern in the information technology (IT) world. Might companies cut back on spending in light of the slowing economy?

Well, as for Red Hat (NYSE: RHT), the environment seems to be OK. For example, in Q4, the company posted a 27% increase in revenues to $141.5 million. What's more, bookings are bulging (above $200 million).

While RedHat has a strong business with its Linux offerings, the company is also seeing lots of traction with its middleware platform, known as JBoss. Interestingly enough, with Oracle's (NASDAQ: ORCL) buyout of BEA Systems (NASDAQ: BEAS), there's been a surge in downloads of JBoss. Basically, customers want an alternative.

Going forward, Red Hat forecasts revenues of $665 million to $680 for the upcoming year. Earnings are expected to range from $0.78 to $0.82 per share.

And Red Hat recently purchased Amentra, which is a systems services company. Basically, the deal will allow Red Hat to continue to turbocharge its sales of JBoss.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates DealProfiles.com.

Red Hat sees some green originally appeared on BloggingStocks on Sun, 30 Mar 2008 11:10:00 EST. Please see our terms for use of feeds.

When the company announces its earnings, analysts are expecting to see earnings excluding items of 30 cents on sales of $5.4 billion, up from 25 cents a share and $4.41 billion in revenue reported in the same period a year ago.

Despite the weak market conditions and economic slowdown, Oracle has so far been able to beat or at least match analysts' expectations when it has reported earnings. For the current quarter, the company also expects strong earnings results. This might be due to the company's recent acquisitions whose maintenance revenue help offset weak earnings coming from its customers affected by the tumbling economy.

Continue reading Oracle (ORCL) expects strong quarterly earnings

Oracle (ORCL) expects strong quarterly earnings originally appeared on BloggingStocks on Wed, 26 Mar 2008 11:24:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• HSBC downgraded Novartis (NYSE: NVS) to Underweight from Neutral, as they believe the company's mid-single digit pharma sales growth is not sustainable.
  
• AIG (NYSE: AIG) was downgraded to Market Perform from Outperform by Keefe Bruyette due to their concerns about the company's deteriorating profit trends.
  
• Diageo (NYSE: DEO) was lowered to Neutral from Buy by Goldman Sachs to reflect a lack of near-term catalysts.
  
• Deutsche Bank downgraded BEA Systems (NASDAQ: BEAS) to Hold from Buy, as they believe it is likely that the acquisition will close in April.

• Live Nation (NYSE: LYV) was dropped to Hold from Buy by Morgan Joseph.
• Jackson Hewitt (NYSE: JTX) was dropped to Neutral from Buy at FTN Midwest.
• Roth Capital downgraded Collagenex (NASDAQ: CGPI) to Hold from Buy.
• Credit Suisse lowered MFA Mortgage (NYSE: MFA) to Neutral from Outperform.

Analyst downgrades: NVS, AIG, DEO and BEAS originally appeared on BloggingStocks on Fri, 29 Feb 2008 11:38:00 EST. Please see our terms for use of feeds.

BEA Systems (NASDAQ: BEAS), Oracle (NASDAQ: ORCL) announced it will acquire all outstanding shares of BEAS for $19.75 in cash, an $8.5 billion deal.

BEAS board of directors unanimously approved the transaction.

BEAS option volume was heavy with 54,526 contracts trading on January 15, 2007. BEAS January straddle was priced at $1.10. BEAS February option implied volatility of 55 is above its 26-week average of 40 according to Track Data, suggesting larger price movement.

Options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Options update 1-16-08: BEA Systems volatility up following ORCL deal originally appeared on BloggingStocks on Wed, 16 Jan 2008 09:48:00 EST. Please see our terms for use of feeds.

I have been following BEA Systems (NASDAQ: BEAS) since the mid 1990s. What was once a cutting-edge, leading applications infrastructure play has turned into a me-too, has-been company. The worst part of it all, BEA thinks -- it actually thinks -- it is good! It's an arrogant company led by an arrogant management team.

I visited BEA three times from early 2000 to late 2004, and guess what? BEA was for sale and looking for a suitor even then. Management gives the illusion of wanting to go it alone, and yet several managers made it clear to me and my clients at the time that they would "listen to anyone" -- you know, the old fiduciary responsibility line.

Oracle (NASDAQ: ORCL) has been rumored since 2002 to be buying BEA Systems. I think the rumors were promoted by none other than BEA itself. In the meantime, Oracle was attempting to "research and develop" a competing product set versus BEA, but with Oracle being Oracle, it was not to be. Oracle has adopted a more productive strategy of acquiring companies, especially beaten-down ones, rather than developing its own in-house applications. At the end of the day, Oracle is a master of the database world and a C player in the apps world.

Continue reading BEA Systems: Oracle is probably your only option

BEA Systems: Oracle is probably your only option originally appeared on BloggingStocks on Mon, 29 Oct 2007 10:29:00 EST. Please see our terms for use of feeds.

Oracle (NASDAQ: ORCL) had threatened to walk away from its $17 offer for BEA Systems (NASDAQ: BEAS) and it did. The larger company had set a 5 PM deadline yesterday for a response. "BEA shareholders should not assume that Oracle will renew its $17 per share offer in the future," Oracle said in a statement picked up by Reuters.

Adding to the pressure, BEA shareholder Carl Icahn has threatened a proxy fight if the company is not auctioned off. The company has lost most of its alternatives because no other firm would match the Oracle offer.

It appears that BEA gambled and lost. It must have believed that Oracle would raise it bid to lock in a deal for the company. The BEA board issued a statement saying that the company was worth $21. But no one seemed to buy that. The stock had not traded above $17 for about four years.

BEA is now left with few if any alternatives. Icahn may be able to force a sale of the company, but the only buyer would appear to be Oracle. In the meantime BEA shares are likely to take a sharp fall.

Douglas A. McIntyre is an editor at 247wallst.com.

Oracle (ORCL) walks out on BEA Systems originally appeared on BloggingStocks on Mon, 29 Oct 2007 04:20:00 EST. Please see our terms for use of feeds.

The BEA Systems (NASDAQ: BEAS) board may think that their company is worth $21 a share. After consulting with their bankers at Goldman Sachs, that is the price they put on the company in a public letter to Oracle (NASDAQ: ORCL). The larger company has made an offer to buy BEAS for $17.

Oracle, as might have been predicted, says that $21 is absurdly high and has threatened to withdraw its offer.

Yesterday, Carl Icahn, who owned 15% of BEAS, told the company that it should take the highest best offer and be done with it. Reuters writes that he demanded in a letter to the BEA board that it let shareholders vote on the best bid that emerges from an auction. "It's completely insane to lose a stalking horse," Icahn said in an interview with the news service, referring to Oracle. He said he is prepared for a proxy fight to make his point.

Icahn is often right in these matters, but in this case he is especially right. BEAS is a fairly ordinary company.The company has not traded above $17 since early 2002. And, no other bidder has emerged at $17, although there was some speculation that IBM (NYSE: IBM) might step in. It would appear that other companies think that Oracle's current price point is rich and generous.

The BEAS board is wrong. If Oracle leaves the field, the stock will probably drop back to $12, where it traded in August. There will be no winners then, only losers.

Douglas A. McIntyre is an editor at 247wallst.com.

Icahn strikes again, wants BEA Systems (BEAS) sale originally appeared on BloggingStocks on Sat, 27 Oct 2007 06:54:00 EST. Please see our terms for use of feeds.

BEA Systems (NASDAQ: BEAS) was able to get Goldman Sachs (NYSE: GS) to suggest that the company is worth $21 a share. The stock has not traded that high in over four years. But Oracle (NASDAQ: ORCL) has made a bid of $17, and the BEAS board wants to see if it can get more.

The plan does not appear to be working out. Oracle said that it would not pay extra money for the smaller company and will simply take its case to shareholders.

Reuters writes that "Oracle said BEA's price represented an 80 percent premium to its shares before activist shareholders started pushing for a sale of the company, and nearly 11 times BEA's revenue from software maintenance services in the last 12 months." If the BEAS shareholders do not push its board to take the offer, Oracle has threatened to move on.

BEA Systems has a problem. The number it has picked for valuing the company is arbitrary. The company's stock price before the Oracle offer does not support it. Shares changed hands in the $13 to $14 range. And no other company has come along to even match Oracle's $17 offer.

The BEAS board may be dooming a buyout and that would probably send shares back to their pre-offer lows. That kind of behavior often brings shareholder lawsuits and trouble that the company's management does not need.

BEA Systems ought to wise up and take the money on the table.

Douglas A. McIntyre is an editor at 247wallst.com.

BEA Systems plays dangerous game with Oracle's buyout offer originally appeared on BloggingStocks on Fri, 26 Oct 2007 10:43:00 EST. Please see our terms for use of feeds.

Before the bell: VG, VZ, ORCL, BEAS, M originally appeared on BloggingStocks on Fri, 26 Oct 2007 08:17:00 EST. Please see our terms for use of feeds.

Oracle (NASDAQ: ORCL) has given BEA Systems (NASDAQ: BEAS) until Sunday to accept its buy-out offer. Oracle has offered $17 a share. Before the buy-out rumors started to move the stock up, it traded around $14.

According to Reuters, "BEA responded by saying it had no intention of coming to the negotiating table unless Oracle raised its bid." That is despite the fact that Carl Icahn has taken a piece of the company and wants a sale.

BEA has almost certainly hoped for a second bidder, but that phantom buyer has not emerged.

While the board of the company plays a game of chicken with Oracle, the common shareholder may be left holding the bag. It has a sure thing at $17; the rest is hot air. With Goldman as its bank, BEA has almost certainly contacted all other potential buyers.

The BEA board should do the right thing -- sell the company and get the common shareholder a good return. Board members should make money on their own options and go home and sleep well tonight knowing that there will not be class action suits from people who know they did not take the bird in the hand.

Douglas A. McIntyre is an editor at 247wallst.com.

BEA Systems: Too smart for its own good? originally appeared on BloggingStocks on Wed, 24 Oct 2007 10:47:00 EST. Please see our terms for use of feeds.

It's as if M&A is in overdrive for the software space. SAP AG (ADR) (NYSE: SAP) agreed to pay $6.7 billion for Business Objects S.A. (ADR) (Nasdaq: BOBJ). And, of course, today Oracle Corporation (Nasdaq: ORCL) announced a $6.6 bid for BEA Systems, Inc. (Nasdaq: BEAS).

What's going on here? Well, I had a chance to interview an expert on the topic: David O'Connell, who is a senior analyst at Nucleus Research.

Q: What's your take on the recent activity?

A: "What's driving this is that SAP and Oracle both want to be the biggest kid on the block. They each want to be the only vendor that companies turn to when they buy software. Oracle buys Hyperion, so SAP buys Business Objects. Oracle may buy BEA, so maybe SAP will buy a vendor with a strong integration or SOA offering. It's always hard to tell who's winning. The good news is that end users can be the winners if they say to their account representative, 'hey, I'm buying almost all my software from you, so prices have to come down, and deployments have to be flawless, or I'll ruin your holiday by taking all that business to your rival.'"

Q: Why now?

A: "Because SAP and Oracle both need new customers. The market for selling major applications, especially ERP, to the largest companies is pretty saturated. So SAP and Oracle need new ways to grow revenues. They are starting to go head to head with one another in the market for smaller companies, where Microsoft (Nasdaq: MSFT) dominates. Smaller companies have smaller IT staffs and less time to dedicate to IT. So SAP and Oracle want to court these customers with full product suites, the benefit of one stop shopping, and the alleged benefit of integration among their acquired applications. Buying new products and customers through acquisition is another way to grow revenues.

"Oracle's bid for BEA is a great integration play. Oracle has bought a lot of solutions over the years, so it is putting a lot of development and money into Fusion, which gives customers ways to create integration among their various Oracle applications. BEA basically helps companies integrate their various applications. So BEA is a logical way for Oracle to create integration among its acquired products, and for Oracle customers to create integration among their Oracle solutions. I don't see who else would come to the table. Business Objects will be a huge integration challenge for SAP, so I don't think the timing would be right there. Buying BEA would be duplicative for HP (NYSE: HPQ) and CA (NYSE: CA), who already have lots of integration capabilities in their offerings."

Also, if you want to check out other recent M&A deals, click here.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements.

SAP buys Business Objects, Oracle bids on BEA Systems: Why the software M&A fest? originally appeared on BloggingStocks on Fri, 12 Oct 2007 17:35:00 EST. Please see our terms for use of feeds.

Oracle (ORCL) offers BEA Systems (BEAS) $17 a share -- will it offer more? originally appeared on BloggingStocks on Fri, 12 Oct 2007 12:15:00 EST. Please see our terms for use of feeds.

Oracle (ORCL) flat after BEAS offer originally appeared on BloggingStocks on Fri, 12 Oct 2007 11:54:00 EST. Please see our terms for use of feeds.

Sybase(NYSE;SY), a global enterprise software company with June 2007 total quarterly revenue of $1 billion, is recently up 42 cents to $24.88. SY has a market cap of $17.6 billion. SY is expected to announce EPS on 10/25. According to Dow Jones, Sandell Asset Management, an owner of 6% of SY, wants SY to repurchase shares or look at selling the company. SAP AG (NYSE:SAP), recently announced a $6.8 billion takeover of Business Objects (NASDAQ:BOBJ) and Oracle (NASDAQ:ORCL) proposed taking over BEA Systems (NASDA:-BEAS), a supplier of service oriented architecture (SOA) and middle-ware software. SY November option implied volatility of 29 is above its 26-week average of 26 according to Track Data, suggesting slightly larger risk.

Openwave Systems(NASDAQ:OPWV), a provider of software solutions for the communications and media industry, is recently down 7 cents to $4.93. OPWV will announce EPS on 10/25. Barron's reported on 5/27/07 SY might be interested in OPWV. OPWV over all option implied volatility of 65 is near its 26-week average according to Track Data, suggesting non-directional risk.

Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Option update: Sybase(SY) volatility Up on Activist investor & industry consolidation originally appeared on BloggingStocks on Fri, 12 Oct 2007 11:15:00 EST. Please see our terms for use of feeds.

General Electric (NYSE: GE) reported in line third EPS of 50 cents.

• GE reported revenues of $42.5 billion, up 12%, organic revenue growth was 8%, global revenue growth was 15%.
  
• GE CEO Jeffrey Immelt said: "Our outlook for the remainder of the year is strong."
  
• GE overall option implied volatility of 22 is above its 26-week average of 20 according to Track Data, suggesting slightly larger risk.

BEA Systems (NASDAQ: BEAS), a leading supplier of service-oriented architecture (SOA) and middle-ware software, received a proposal from Oracle (NASDAQ: ORCL) to be acquired for $17 a share in cash.

• BEAS is recently trading up $3.41 to $17.03 in pre-open trading.
  
• Dow Jones reported Carl Icahn had a 13.22% stake in BEAS.
  
• BEAS has been frequently mentioned as an M&A target over the last four years.
  
• BEAS overall option implied volatility of 41 is near its 26-week average of 39 according to Track Data, suggesting non-directional risk.

Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Option update: GE EPS inline, ORCL proposes BEAS buyout originally appeared on BloggingStocks on Fri, 12 Oct 2007 09:39:00 EST. Please see our terms for use of feeds.

• Deutsche Bank downgraded REITs AvalonBay (NYSE: AVB), Boston Properties (NYSE: BXP), Health Care REIT (NYSE: HCN), Kimco (NYSE: KIM) and Public Storage (NYSE: PSA) to Hold from Buy on valuation following the recent share appreciation.
  
• Business Objects (NASDAQ: BOBJ) was downgraded to Neutral from Outperform at Baird following its acquisition by SAP AG (NYSE: SAP).
  
• Wachovia downgraded Allstate Corporation (NYSE: ALL) to Market Perform from Outperform and P&C Insurance (NYSE: PGR) citing deteriorating fundamentals in personal lines.

• UBS downgraded BEA Systems (NASDAQ: BEAS) to Neutral from Buy.
  
• JP Morgan downgraded Merrill Lynch (NYSE: MER) to Neutral from Outperform.
  
• Sealy Corporation (NYSE: ZZ) was downgraded to Neutral from Buy at Banc of America.
  
• Friedman Billings downgraded technology stocks, lowering ASE Test Limited (NASDAQ: ASTSF), ASML Holding (NASDAQ: ASML), KLA-Tencor (NASDAQ: KLAC) and Rudolph Technologies (NASDAQ: RTEC) to Market Perform from Outperform.

Analyst downgrades: REITs, BOBJ, ALL and PGR originally appeared on BloggingStocks on Mon, 08 Oct 2007 11:05:00 EST. Please see our terms for use of feeds.

• Jim Cramer's Best Blogs
• Value Stock-Picking, Week 1: How to Find Top Dividend Plays

Cramer on BloggingStocks: Buy BEA Systems before it gets a bid originally appeared on BloggingStocks on Mon, 08 Oct 2007 08:30:00 EST. Please see our terms for use of feeds.

• Cramer was positive on Google Inc. (NASDAQ: GOOG) today.
• Here is his list of Top 9 Picks for 2007
• Here is his "New Four Horsemen of Tech"
• Here is his Mortgage Madness Portfolio, which way outperformed today.
• Here are his Top China Picks.

Cramer wants to chase Icahn into BEA Systems (plus major market lists to buy) originally appeared on BloggingStocks on Wed, 19 Sep 2007 18:05:00 EST. Please see our terms for use of feeds.

Carl Icahn put some real money on the table when he bought 8.5% of business software provider BEA Systems, Inc. (NASDAQ: BEAS). The company has a market cap of over $5.2 billion. It trades at just over $13 and moved up after hours on the news. Icahn had previously held a much smaller number of shares.

In an SEC filing quoted at MarketWatch "A sale of [BEA Systems] to a strategic acquirer will maximize the price of the shares," Icahn said, adding that he intends "to seek to meet with management of the Issuer to discuss the potential for such a transaction, as well as the Issuer's business and operations generally."

Although the company has posted good revenue growth around its core business of transaction tracking software, the company has not been able to report earnings because of an ongoing investigation into stock option grants. For the quarter ending July 31, BEA said revenue rose to $364.6 million from $339.6 million in the 2006 quarter.

The late SEC filings due to options problems has also put the company's Nasdaq listing at risk.

BEA has been the subject of takeover rumors. In July, a Credit Suisse analyst floated the idea that Oracle Corporation (NASDAQ: ORCL) might buy the company.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Icahn seeks sale of BEA Systems originally appeared on BloggingStocks on Fri, 14 Sep 2007 17:05:00 EST. Please see our terms for use of feeds.

BEA Systems (NASDAQ: BEAS) September call volume & volatility Up on Icahn position. BEAS, a leading supplier of service-oriented architecture (SOA) and middle-ware software, is recently up .50 to $13.27. BEAS has market cap of $5.1 billion. Dow Jones reported Carl Icahn owns 33.4 million shares of BEAS stock including 16.2 million options. BEAS September option implied volatility is at 58; October is at 40; above its 26-week average of 38 according to Track Data, suggesting larger risk.

Macy's (NYSE: M) is recently up .90 to $30.25 on renewed takeover chatter. M is expected to report EPS on November 14. M September 30 straddle is priced at $2. M October option implied volatility of 50 is above a level of 47 from 9/13/07 and above its 14-week average of 38 according to Track Data, suggesting larger risk.

Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Option update: BEA System September call volume & volatility Up on Icahn position originally appeared on BloggingStocks on Fri, 14 Sep 2007 16:45:00 EST. Please see our terms for use of feeds.