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What's Behind Qlik Technologies' (QLIK) 18% Drop?

NEW YORK (TheStreet) -- Qlik Technologies  (QLIK) lost around one-fifth of its share value after reporting disappointing third-quarter revenue and forecasting fourth-quarter and full-year profit well below analyst estimates.

For the third-quarter ended Sep. 30, the analytics software maker earned 3 cents a share, compared to break-even  in the year-ago period.

Revenue totaled $104.1 million, 21% higher than a year earlier, as growth in the Americas offset weakness in Europe and Asia-Pacific. However, analysts surveyed by Thomson Reuters had expected $107.7 million in revenue.

For the fourth quarter, the Radnor, Pa.-based business predicts earnings of 28 cents to 31 cents a share on revenue between $156 million and $161 million. The forecast came in significantly lower than analysts' expectations of 45 cents a share on $165.78 million in revenue.

For the full year, the company projects revenue between $465 million and $470 million, and earnings between 23 and 26 cents a share. Analysts had expectations of 38 cents a share on $478.45 million.

CEO Lars Bjork said added complexity of larger enterprise-level customers had impacted the business' top line, a problem that would take time to remedy.

"We are taking action to bring more discipline to the management of our growing pipeline, and we expect these changes to take some time to fully impact our results, which is reflected in our fourth-quarter guidance," he said in a statement.

Shares were trading 18.9% lower at $27.15 as of 11:55 a.m. EDT, recovering slightly from earlier losses of more than 20%. So far, 12.3 million shares have changed hands compared to its three-month average daily trading volume of 1.4 million.

TheStreet Ratings team rates Qlik Technologies Inc as a Hold with a ratings score of C. The Team has this to say about its recommendation:

"We rate Qlik Technologies Inc (QLIK) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and feeble growth in the company's earnings per share."

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