BEA Systems: Screaming Buy

Published: May 16, 2007, 5:12 am

Tags: investments, announcement, finance, beas, earnings, stock picks, estimates stocks

Takeover rumors have been flying around BEAS. Business software and services have been receiving substantial attention as of late. If there is speculative money to invest, it might pay to examine this one. Recently Credit Suisse lowered its rating to "neutral" from "outperform", stating that recent thoughts of a takeover from Hewlett-Packard Co.(HPQ) "was more wishful thinking than reality." They went on to reiterate their $14 price target on BEAS. In my opinion, Hewlett isn't the only prospective buyer. At this time, this company is in a great position for its shareholders. If they continuously beat estimates, they should have no problem standing on their own and meeting that $14 price target. If BEAS misses estimates in the future, they become a more attractive takeover target, enabling another company to possibly make a purchase at a discounted price. It's not that often, within an investment, that something can be perceived as a win-win situation.

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