Investors Hear Sybase Now

Competing with bigwigs like Oracle (Nasdaq: ORCL  ) and IBM (NYSE: IBM  ) , Sybase (NYSE: SY  ) often gets lost in the noise. But over the past month, Sybase's stock price has spiked roughly 20%. That's partly because hedge fund Sandell Asset Management recently took a 6% position in the company, and partly because Sybase's business seems to be gathering speed.

In fiscal Q3, revenue rose 22% to $255.3 million, while license revenue climbed 12% to $85.1 million. Net income came to $34.1 million, or $0.37 per share, and cash flow from operations was a $47.1 million. In all, Sybase has $717.3 million in the bank.

Sybase is getting lots of traction from SQL Anywhere, a database product, and the Information Anywhere Suite, which helps manage data in mobile environments. As a result, the company is snagging customers such as Cardinal Health (NYSE: CAH  ) , Motorola (NYSE: MOT  ) , and Siemens (NYSE: SI  ) .

Sybase's messaging business, focused on enterprise customers, generated $34.3 million in Q3 revenue. Last week, the company launched the new version of its MMS 365 product, which can send large volumes of content -- including photos, audio, video, and ringtones -- to mobile devices. One of the early adopters is Facebook.

Despite the hefty investments, Sybase keeps making progress on its operating margins, which have expanded from 15.4% to 17.4%. As a result, the company has boosted its cash flow guidance to $210 for 2007, compared to the prior estimate of $195 million to $205 million.

As I mentioned in a recent Fool piece, I think investors should downplay any buyout speculation, since those deals are impossible to predict. Nonetheless, Sybase has a solid customer base and a strong product offering. Based on the Q3 results, the company should be making even more noise in the future.

For more Foolishness:


Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 539298, ~/Articles/ArticleHandler.aspx, 9/16/2014 7:40:22 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement