) to hold from buy.
On Friday, Commerce cut the Q2 guidance, and said SAP AG would pay up to $225 million for an increased stake in the company.
Analyst Richard Davis says he was looking for Q2 revenues of $158 million vs. the company's new guidance of $100 million to $120 million. Therefore, he cut the $650 million 2001 revenue estimate to $485 million and cut the $816 million 2002 estimate to $519 million.
Davis says there's a possibility that SAP's cash infusion was a precursor to an acquisition and was most likely the impetus behind an uptick in Commerce One's shares on Friday. While he believes such a combination would be favorable to Commerce holders, he's not prepared to say a buyout is on the immediate horizon. He says at current levels, the stock is probably a third higher than what it should be.