Checkfree Corporation (NASDAQ: CKFR), the check processing and bill presentment software leader, got pounded yesterday by investors on a JPM Securities analyst downgrade. The analyst cited a greater likelihood that Bank of America, CheckFree's largest customer, might move this software function in-house.

CheckFree's public response was not too comforting as it did not deny the possibility.

However, what could be more concerning is CheckFree's recent acquisition strategy. CheckFree has been moving away from its higher growth bill payment business and has focused more on its lower growth businesses. Typically, when a high growth company starts allocating capital away from what got it to the dance, it is not a good sign.

In the past, when CheckFree has gotten hit, we have blogged to jump into the stock. But with the possibility of losing BOFA as a customer, wait for this quarter's earnings call and what management has to say about this possibility. The December quarter's results were quite good. See if it was able to keep the momentum going.