NEW YORK (TheStreet) -- Shares of Digital River (DRIV) were falling 24.4% to $19.28 Monday after the Internet software and services company disclosed that it gave Microsoft (MSFT) an extension to decide on extending their distribution agreement.
Digital River extended the deadline for Microsoft's decision to Dec. 19, 2014 from Dec. 1, 2014. The extension grants Microsoft an additional 18 days to decide if it wants to extend the expiration date of the Microsoft Operations Digital Distribution Agreement between the two companies that is dated Sept. 1, 2006.
As part of their current agreement Digital River builds, hosts, and manages Microsoft's online store that sells both hardware and software.
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TheStreet Ratings team rates DIGITAL RIVER INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate DIGITAL RIVER INC (DRIV) 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 solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall."