Markets & Finance

SG Cowen Cuts PeopleSoft to 'Market Perform'

SG Cowen downgraded PeopleSoft (PSFT) to market perform from outperform.

Analyst Andrew Brosseau says the 11 cents to 12 cents earnings per share guidance is below his 14 cents estimate, and the $450 million to $455 million revenue guidance is below his $487 million est. Brosseau says the services business above expectations, but licenses were down sharply to $80 million to $85 million, marking a 35%-40% fall. Brosseau says management blames a weak economy and the war for weakness, but he says the severity of the licenses miss raises concerns. Brosseau notes, based on his latest survey, he has mixed share prospects for PeopleSoft. He cut the 70 cents 2003 earnings per share estimate to 60 cents, and cut the $2.62 billion revenue estimate to $1.97 billion.

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