Back in the Roaring 1980s, Carl Icahn was known as a prototypical corporate raider as he went hostile on a myriad of old-world companies such as B. F. Goodrich and American Can.

Now, in his early 70s, Icahn hasn't slowed down much. Funny enough, these days he's targeting tech companies, like BEA, Motorola (NYSE: MOT) and, of course, Yahoo! (NASDAQ: YHOO). Hmmmm... maybe these companies have become bloated and mature -- just like the laggards of the 1980s?

Perhaps so. After all, Icahn's strategy is to agitate for change, such as for cost cutting, share buybacks and higher dividends.

As for his pursuit of Yahoo (which involves a proxy fight), it's certainly a gutsy play. Simply put, there's no guarantee that Microsoft (NASDAQ: MSFT) will come to the table again. So far, the company is doing a good job in showing disinterest.

Continue reading Icahn's 'shock and awe' on Yahoo -- a gutsy play

Icahn's 'shock and awe' on Yahoo -- a gutsy play originally appeared on BloggingStocks on Fri, 16 May 2008 10:35:00 EST. Please see our terms for use of feeds.

BEA Systems explains Oracle bid rejection to Icahn originally appeared on BloggingStocks on Mon, 05 Nov 2007 15:16:00 EST. Please see our terms for use of feeds.

Would you trust BEA management or Carl Icahn with your money? originally appeared on BloggingStocks on Tue, 30 Oct 2007 00:14:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Citigroup downgraded shares of BEA Systems (NASDAQ: BEAS) to Hold from Buy on valuation following the $17/share offer by Oracle (NASDAQ: ORCL) as they think a public bidding war for the company is unlikely.
  
• ABN Amro downgraded shares of Nokia Corporation (NYSE: NOK) to Hold from Buy on valuation and believes above consensus Q3 results are already priced into shares.
  
• Wachovia downgraded Medco Health Solutions (NYSE: MHS) to Market Perform from Outperform on valuation.
  
• The firm also downgraded Quest Diagnostics (NYSE: DGX) to Market Perform from Outperform, as they believe the prospects from stabilizing volumes and cost savings are reflected in valuation and Street estimates.
  
• Credit Suisse downgraded shares of PetSmart (NASDAQ: PETM) to Neutral from Outperform citing aggressive pricing at Petco, accelerating growth initiatives, limited visibility around expense management, and lack of consistent results.

• Methanex Corporation (NASDAQ: MEOH) was downgraded to Sector Underperformer from Sector Performer at CIBC.
  
• Rochdale downgraded Heico Corporation (NYSE: HEI) to Neutral from Buy.
  
• JP Morgan downgraded BankUnited Financial Corp (NASDAQ: BKUNA) to Neutral from Outperform and removed Qwest Communications (NYSE: Q) from its Focus List.
  
• Goldman removed MetLife (NYSE: MET) from its Conviction Buy List.
  
• Coldwater Creek (NASDAQ: CWTR) was downgraded to Hold from Buy at Standford and at Stifel.

Analyst downgrades: BEAS, NOK, MHS, DGX and PETM originally appeared on BloggingStocks on Mon, 15 Oct 2007 11:15:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Wachovia downgraded YRC Worldwide (NASDAQ: YRCW) to Market Perform from Outperform citing the challenging LTL freight environment and continued integration issues.

• UBS downgraded shares of BEA Systems (NASDAQ: BEAS) to Neutral from Buy on valuation as they believe expectations for a takeover or investor activism is already priced into shares.

• Matrix believes Isle of Capri (NASDAQ: ISLE) is expensive on a performance-adjusted basis and recommends investors sell shares into the recent rally, downgrading shares to Sell from Hold.

• JP Morgan cut Assured Guaranty (NYSE: AGO) to Underweight from Neutral on valuation.

• JMP Securities downgraded Avaya (NYSE: AV) to Market Perform from Strong Buy, as the firm doesn't expect a superior offer to the Silver Lake/TPG bid...

• MicroChip Technology (NASDAQ: MCHP) was cut to Market Perform from Outperform at Piper Jaffray.

• Morgan Stanley downgraded Wynn Resorts (NASDAQ: WYNN) to Equal Weight from Overweight.

• Baird downgraded Authorize.net Holdings (NASDAQ: ANET) to Neutral from Outperform.

• Morgan Keegan downgraded Inter-Tel Inc (NASDAQ: INTL) to Market Perform from Outperform.

• Stifel cut Dover Downs Gaming & Entertainment (NYSE: DDE) to Sell from Hold.

Analyst downgrades 6-19-07: AV, BEAS, CCE and YRCW originally appeared on BloggingStocks on Tue, 19 Jun 2007 11:21:00 EST. Please see our terms for use of feeds.

The software business is one of the greatest businesses in the world. Software touches our lives every day, hundreds if not thousands of times. From the software-driven cash registers to the iPod to your Select-Comfort bed, software programs and systems run just about everything.

The margins in the software world are obscene. You really cannot kill a software company. They linger on and on and on.... Just look at Bea Systems (NASDAQ:BEAS), Borland Software, Inc. (NASDAQ:BORL) and Novell, Inc. (NASDAQ:NOVL). All three were at one time major players in their day, with multi-billion dollar market cap and fancy marketing campaigns. Now, barely hanging on with depressed share prices. But why are they still alive?

Software companies can hang on by a thread and still put up 20% operating margins. Once the software program is written, the research and development phase, the actual gross margin on the sale to the customer is usually north of 90% --that's right, 90%+. Take away sales and marketing expenses normally in the mid-20% range, R&D costs at 15-17%, general and administrative costs around 6-10%, and you're left with operating margins in the mid- to-high 30% range. With a tough selling environment, sales and marketing costs ramp up to the mid 30's and you are still left with operating margins in the 20% range. Throw in high-margin maintenance programs and you can coast for a long time.

Continue reading Beware of the lure of software stocks

Beware of the lure of software stocks originally appeared on BloggingStocks on Fri, 02 Mar 2007 15:10:00 EST. Please see our terms for use of feeds.