) to hold from buy.
Analyst John McPeake cut his $45 target to $22. He says he thinks the SEC's focus on prior periods makes the company's earnings per share restatement more likely. He's also concerned that managment may be distracted from its core business, and that customers could postpone purchases during this investigation. He notes that while investors will likely assume lower target multiples, he's lowering his estimates and target.
McPeake says he remains positive on the mainframe upgrade and server consolidation cycle. He thinks Computer Associate's product set is well exposed in security, storage and system management, but thinks it is prudent to step aside and let the investigation and related issues play out.