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No one on Wall Street got too excited about the UBS Warburg report on Check Point Software Technologies (Nasdaq:CHKP), in which the bank lowered the shares rating to Buy from Strong Buy. On Friday, Check Point climbed 1.5%, completing a 130% leap since the low $20.7 price it posted after the September attacks.

UBS pins the downgrade on several factors. In layman's terms, says the team of analysts headed by Jordan Klein, Associate Director in the technology group of UBS Warburg Equity Research, the gains in share price in the last few months precede the security giant's business developments, reducing its potential for continued gains.

The investment bank estimates Check Point's Q4 results due for release January 15 may be higher than Wall Street analysts average expectations for revenues of about $122 million and a 29 cents EPS, still such results do not call for a Strong Buy rating for the share.

UBS: Operating profit margins to remain at same level in Q4
"The operating profit margins are expected to remain within the 60% to 65% range, but we believe and are concerned with the fact the company may post drops in its deferred earnings, which totaled $100 million in the third quarter," says the bank.

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Check Point itself estimated when reporting its Q3 results that deferred Q4 earnings should remain at the same level.

The bank maintains its 2002 $1.34 profit forecast for the share, on estimates demand for firewall and VPN products will increase in the course of the year.

In the same breath, the bank hikes the share's target price to $54 from $40. The Buy rating and its current $47.5 target price call for the hike.