Jefferies & Co. today lowered its rating of Sybase (SY) to Hold from Buy. Analyst Ross MacMillan kept a price target of $47 for the database vendor.
He thinks the company is likely to report a good first quarter — set for April 22 — but writes, “we view CY10 as a transition year, as Sybase comes off a period of above-market database growth, while its mobile software business
takes time to accelerate and become a more meaningful driver of revenue growth.”
With the stock’s forward P/E multiple above three-year and five-year averages, MacMillan says multiple expansion will rely on an acceleration of revenue, “which we don’t expect for a few quarters at least.”
Shares of Sybase are down 2.4%, or $1.13, today to $45.95.
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