Ahead of the Bell: Blue Coat shares slip

Shares of Blue Coat Systems declined in premarket trading Thursday after an analyst downgraded the stock, questioning whether the network security company could successfully integrate its recent purchase of Packeteer Inc.

Sunnyvale, Calif.-based Blue Coat finished its $268 million buyout of Packeteer on Monday. Its shares have fallen 8.5 percent since Friday's close _ part of a four-session losing streak _ and are close to their 52-week low of $16.20 set May 22. In premarket trading, the stock lost 32 cents to $16.40.

Joanna Makris of Brean Murray Carret and Co. says she is not sure how well the two companies will combine, and said the U.S. enterprise market will be weak for the rest of this year. She downgraded Blue Coat shares to "Sell" from "Buy," and cut her price target to $11 per share from $26.

Lazard analyst Ryan Hutchinson took a more positive view, saying the benefits of the combination outweigh the risks. He kept a "Buy" rating, and raised his price target to $33 from $27.