DETROIT ? The good news at Compuware in October ? a well attended OJ dot X developers? conference, recognition as one of Metropolitan Detroit’s 101 Best and Brightest Companies to Work For, the Women’s Leadership Index Most Valuable Player award ? could run out Thursday when the state?s largest native software company announces its quarterly financial results.
Compuware, which primarily writes software and provides services for mainframe computer users, warned two weeks ago that it expects to report a fiscal second-quarter profit of 6 cents a share on revenue of around $288 million for the period ended Sept. 30. Wall Street analysts, on average, had been expecting a profit of 7 cents a share on revenue of $311.1 million, according to a Thomson First Call survey that included estimates from four brokerages. As a result, the company?s stock price took a hit.
Compuware CEO Peter Karmanos Jr., in a statement earlier this month, said the second quarter proved to be a challenging one in regards to closing deals. But the second half of the year should be better. “We, therefore, reaffirm our previously stated guidance for the year,” he said.
In May, Compuware predicted a profit for the year of 30 cents to 35 cents a share. The current average of analysts’ estimates calls for earnings of 38 cents a share on revenue of $1.31 billion for the year, besting Karmanos? rosiest projections.
David Rudow, senior research analyst at Minneapolis-based Piper Jaffray & Co., said he?s not worried about Compuware hitting its financial marks.
?We remain confident in our investment thesis on Compuware,? Rudow said in an Oct. 10 report. ?In our opinion, the shares are reasonably valued, given the margin expansion potential, solid product portfolio, and its early stage turnaround.?
Compuware?s shares hovered around $7.94 a share in afternoon trading Monday, but analysts estimated the upside potential to be $10.50 a share for the year.
If image is part of Compuware?s financial estimates, than the company gets a grade of A for all the positive publicity it generated in October.
Two weeks ago, Compuware was recognized as one of Metropolitan Detroit’s 101 Best and Brightest Companies to Work For by the Michigan Business and Professional Association.
Monday, the 2005 Michigan Women’s Leadership Index Named Compuware a Most Valuable Player. Compuware posted the second highest score among the 100 publicly held companies on the list.
At the beginning of October, Compuware hosted its second annual developer?s conference and drew nearly 1,500 developers, customers and employees from around the world, twice as many as last year.
?We had two goals for the OJ.X conference,? said Compuware Marketing Vice President Larry Angeli. ?We are the largest tech player in Detroit and Pete (Karmanos) thought it was important for Compuware to bring the tech community together, and to see our new headquarters. We also compete in the application development space. OJ.X helps drive sales and builds momentum for the company.?
Gartner Group Analyst Theresa Lanowitz, who attended the conference, agreed.
?The conference was very important for the industry and the company,?? she said. ?It galvanized people and the industry to work together. It?s a good platform to showcase what Compuware is doing for its customers.?
Lanowitz said Compuware wants to morph its product line across multiple platforms beyond its mainframe roots to include Java and Dot Net. The company also wants to modernize its mainframe system, move forward around a strategy of IT integration and develop the company into a product life cycle software provider to help business in every stage of product development.
?Mainframe computers are not going away,? Lanowitz said, ?just becoming more agile.?
Compuware hopes Wall Street puts the same spin on its financial future.
