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TIBCO Software shares bounce back after downgrade


Shares of TIBCO Software Inc. rebounded in Tuesday afternoon trading, after the company denied it plans to cut jobs, as suggested by a ThinkEquity LLC analyst in downgrade.

THE SPARK: In a note to clients early Tuesday, ThinkEquity analyst Yun Kim said that there may be "lingering organizational issues" within the company's Americas region that could lead to a "sizeable headcount reduction" there. In turn, Kim downgraded the company's shares to "Hold" from "Buy."

The note sent the shares down nearly 11 percent in very heavy trading. But the stock reversed its slide after the company said Kim's view was off the mark.

THE BIG PICTURE: Kim said that checks since early last week suggest that job cuts are ahead for the Palo Alto, Calif.-based software company. The analyst estimated TIBCO could cut up to 10 percent of its Americas region's jobs, across all of its groups.

There were 1,561 employees in the Americas region as of the end of its last fiscal year.

Kim suggested the cuts were related to TIBCO's efforts to streamline operations following a number of acquisitions in recent years, and also reflective of lingering organizational and sales execution issues in the region that could signal more modest growth ahead.

TIBCO issued a simple statement that said the research was incorrect. "TIBCO did not engage in such an action, or incur any related restructuring charge, in its third fiscal quarter and is not currently contemplating such an action," the company said in a regulatory filing.

SHARE ACTION: Shares rebounded after their morning drop, and were trading down 73 cents, or 2.3 percent, at $31.55. Volume, normally about 2.1 million shares, topped 11 million. The stock has changed hands between $19.52 and $34.67 in the past 52 weeks.


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