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Robinson Humphrey downgraded Art Technology (ARTG
) to neutral from outperform.
Analyst William Chappell says he's surprised by the magnitude of the software company's shortfall. He notes that several customers have delayed technology purchases due to the economic environment. Chappell believes it will take a few quarters for the company to implement cost cutting measures. At the current levels, he says it's tough to call the stock "cheap."
Although Art Technology has plenty of cash to get through a downturn, he recommends investors stay on the sidelines until the necessary cost cuts are in effect, and the company is able to stabilize and gain momentum. Chappell put the 2001 and 2002 estimates under review.