How Will Tibco Software (TIBX) Stock Respond to These Mixed Analyst Actions?

NEW YORK (TheStreet) -- Shares of Tibco Software Inc. (TIBX) are flat in early market trading after the California-based company had its rating raised to "equalweight" from "underweight" at Barclays, with a higher price target of $24 from $19.

Separately, Tibco Software was downgraded at RBC Capital to "sector perform" from "outperform" this morning.

Despite its cut in rating, analysts at RBC Capital slightly raised its price target to $24 from $23.

TheStreet Ratings team rates TIBCO SOFTWARE INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate TIBCO SOFTWARE INC (TIBX) 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 largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • TIBX's debt-to-equity ratio of 0.60 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that TIBX's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.85 is high and demonstrates strong liquidity.
  • The gross profit margin for TIBCO SOFTWARE INC is currently very high, coming in at 72.55%. Regardless of TIBX's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, TIBX's net profit margin of 1.02% is significantly lower than the industry average.
  • Net operating cash flow has significantly decreased to -$9.21 million or 115.79% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Software industry and the overall market, TIBCO SOFTWARE INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • You can view the full analysis from the report here: TIBX Ratings Report

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