Markets & Finance

Analyst Actions: Christopher & Banks, Theravance, Chordiant


What Wall Street analysts are saying about companies in the news Thursday

CHRISTOPHER & BANKS CORP.

From Standard & Poor's Equity Research

Merriman Curhan cuts estimates

Analyst Erin Moloney says the company's (CBK) third quarter EPS of 29 cents was above her 28 cents estimate. But she notes C&B cut its 6 cents to 8 cents fourth-quarter EPS guidance to 2 cents to 5 cents, which assumes same-store sales comparisons (comps) to be flat to down in the low-single digits; it also anticipates December comps decreasing 1%-2%. Despite the comp decline, she's encouraged to hear merchandise margins are expected to be higher than last year, particularly amidst a difficult retail environment. Based on her expectations for sales trends to remain down vs. last year in the near-term, Moloney cuts her $138.1 million fourth quarter revenue estimate to $130.5 million, and her 7 cents EPS estimate to 3 cents. The analyst cut her $653.6 million fiscal 2009 (Feb.) revenue estimate to $609.4 million, and her 95 cents EPS forecast for the full fiscal year to to 82 cents. Moloney kept her neutral rating on the shares.

THERAVANCE, INC.

Credit Suisse rates outperform

Theravance (THRX) says an FDA committee will review its Telavancin compound.

Analyst Michael Aberman says he thinks the FDA review simply a reflection of newly reauthorized Prescription Drug User Fee Act, which requires referral to advisory committee for all new chemical entities. However, with little known about contents of recent approvable letter and more hostile FDA environment, FDA review clearly increases risk of a bad outcome. Still, with approvable letter in hand and recently announced positive hospital acquired pneumonia data, believes most likely outcome is approval. Aberman thinks the stock will see continued pressure as it faces financing overhang, but believes Theravance will outperform in 2008 as he believes telavancin will ultimately get approved. The analyst has a $36 price target on the stock.

CHORDIANT SOFTWARE

CIBC World reiterates sector outperform

Analyst Brad Reback says Chordiant (CHRD) filed a Form 8-K detailing a $26 million license and support deal with Vodafone (VOD) for 18 of Vodafone's units in Europe, Mideast, Africa (EMEA) and Asia & Pacific (APAC). He notes the deal is the largest in Chordiant's history, and yet another demonstration of the increasing geographic and vertical diversity in its business, as this first time it entered the APAC region. Reback says the deal will contribute, at worst, $18.9 million of license revenue overall, including $9.1 million in fiscal 2008 (Sept.), giving additional visibility. He notes the company also pre-announced first-quarter results, falling short of his estimate on higher commission expense, lower-than-expected revenue from Vodafone in the first quarter; Reback feels the pre-announcement is mostly a non-event. He has a $16 price target on the shares.


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