) to sector perform from sector outperform.
Analyst Brad Reback downgrades the stock on his view potential risks are tied to near-term operational performance of the company's mid-markets sales force, and ADP reseller channel doesn't support the current stock price.
He says the analyst meeting held yesterday failed to make him any more comfortable with the state of the company's mid-markets business, one of culprits of disappointing second-quarter results. Nor did he get any indication that visibility into the ADP channel has definitively increased.
Reback notes Kronos was recently trading at about 26 times his $1.65 2005 earnings per share estimate (at the high end of the group). He says near-term upside to estimates are unlikely.