DETROIT – Compuware Corp. surprised Wall Street and beat first quarter earnings estimates, which has been rewarded with more favorable ratings from some analysts.
The computer software and services company reported this week adjusted earnings per share increased 100 percent to a penny in the first quarter of fiscal year 2014 ended June 30 compared with EPS in the same quarter last year of a half cent. Revenue rose a little more than a half percent to $227.5 million from the year ago quarter, beating the average revenue estimate of $226.92 million.
Wall Street had been looking for a half cent a share increase. As a result, J. Derrick Wood with Susquehanna International Group LLP maintained a neutral rating for Compuware, but raised his target price from $11 to $12.50.
Aaron Schwartz with Jefferies & Co. rated Compuware stock a buy in his report Wednesday and projects a 12-month target price per share of $13. The stock closed Thursday at $11.04 a share.
?The first quarter was a good start to the year, and the results support our fiscal year 2014 forecast,? said Compuware President and CEO Bob Paul. ?The quarter was marked by several positive developments, including the improvement of our sales pipelines, the release of key, innovative solution enhancements and the acquisition of several new, strategic customers in critical new growth areas.
?In addition to establishing strong momentum during the quarter, Q1 was also highlighted by the continued progress of our shareholder-creation initiatives, including the issuance of the company?s first-ever quarterly cash dividend and the furthering of our cost-rationalization efforts,? he said. ?Regarding these efforts, we remain on track to eliminate $45 million in corporate expenses in fiscal year 2014, as part of our larger goal of eliminating a minimum of $80 million to $100 million of these costs from the business over the next two years.?
In other news, Covisint, a Compuware company, announced that it has appointed Enrico Digirolamo as Chief Financial Officer. In this role, Digirolamo will manage all aspects of Covisint’s worldwide financial reporting, accounting, internal audit and taxation.
Most recently, Digirolamo was Senior Vice President at Allstate Insurance. He served as Vice President and Chief Financial Officer for General Motors Europe from 2008-10. Digirolamo also served as the CFO for GM’s North American Sales, Global Powertrain Operations and South American Operations. He was also the CFO and acting President of Covisint at the time of its formation in 2000.
