JMP Securities upgraded Exult (EXLT

) to strong buy from outperform.

Analyst James Wilson says Exult's shares are oversold, and may be bottoming out, while fundamentals remain strong. He says the stock is down 39% from a recent $9.50 high due to a $100 million convertible debt offering, and a share sale by BP, one of Exult's two strategic investors, since September.

Wilson believes nothing has changed operationally for this provider of human-resource management services, and he thinks prospects for new customers and margin improvement remain good. He says the company is uniquely positioned in the marketplace, and that 20% to 25% secular revenue growth is achievable. Wilson sees 5 cents fourth-quarter earnings per share, 17 cents in 2003, and 35 cents in 2004. He has an $11 price target.