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Standard & Poor's


03/02/15 04:14:54 PM

International Business Machines Corporation, Qihoo 360 Technology Co. Ltd., Aruba Networks, Inc.

International Business Machines Corporation(IBM) : In a report published Wednesday, JP Morgan analysts maintained a Neutral rating on International Business Machines Corporation (NYSE: IBM), while reducing the price target from $173 to 170. The analysts highlighted the company's Big Picture strategy. In the report, JP Morgan noted, "IBM management is aiming towards: 1) differentiating itself from peers in its "Strategic Imperatives", 2) re-inventing its Core Portfolio, and 3) adopting more open platforms and partnerships to create ecosystems around technologies. Strategic imperatives should remain a growth driver, and while Core portfolio could decline over the long term, IBM expects to realign its offerings with clients' requirements and emphasize annuity businesses." "Strategic Imperatives (Cloud, Analytics, and Engagement) could represent a trillion dollar addressable market opportunity by 2018, up from ~$600bn today," the analysts commented, while adding that the company's target of low single-digit revenue growth in the longer term appears "achievable by 2017 as faster growing strategic imperatives become a larger part of the business." The analysts wrote, "We like the strategic direction, and think the bears under-appreciate the heavy lifting IBM has done to date to re-mix the business. However, the journey is a long and risky one, requiring solid execution, and more importantly, discipline in balancing long term returns with near term earnings upside." View More Analyst Ratings for IBMView the Latest Analyst Ratings 2015 Benzinga does not provide investment advice. All rights reserved.

Qihoo 360 Technology Co. Ltd.(QIHU) : Morgan Stanley cut its price target on Qihoo 360 Technology Co Ltd (NYSE: QIHU) Monday form $111.50 to $85.00 and maintained an Overweight rating. Analysts led by George Meng said the stock had an "attractive valuation" and highlighted that it had dropped over 20 percent in the past two weeks in addition to a decline of 60 percent from approximately one year ago. With the stock trading trading at 12x 2015 and 9x 2016 estimated non-GAAP EPADS, respectively, the firm "recommend investors to accumulate on stock price weakness." Meng thought the weakness in the stock was due to concerns over a webgame slowdown, app store market share loss and regulatory risk on its online lottery business." Overall, however, the analysts felt that the stock was not a "value trap" and that the market had become too pessimistic. Meng acknowledged that the "overall webgame market is likely to slow down in 2015," however, the company's webgame revenue was only 23 percent of revenues in Q3 2014 and the firm estimated the webgame revenue contribution in 2015 to be less than 15 percent. Meng concluded that "mobile game growth should offset the webgame slowdown." Qihoo was scheduled to report Q4 earnings on March 9 and Meng expected "revenue to grow 89 percent YoY and 11 percent QoQ to $418 million, slightly higher than the company's guidance of 85-87 percent YoY revenue growth." The analysts thought Q4 non-GAAP net income would increase 8 percent year-over-year to $104 million which was 6 percent below consensus of $111 million. Qihoo 360 Technology recently traded at $46.41, up 1.5 percent. View More Analyst Ratings for QIHUView the Latest Analyst Ratings 2015 Benzinga does not provide investment advice. All rights reserved.

Aruba Networks, Inc.(ARUN) : SunTrust Robinson Humphrey downgrades Aruba Networks (NASDAQ: ARUN) from Buy to Neutral.-sources View More Analyst Ratings for ARUNView the Latest Analyst Ratings 2015 Benzinga does not provide investment advice. All rights reserved.


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