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What: Shares of enterprise systems management software company Quest Software
So what: This morning’s preliminary report was negative across the board. Quarterly revenues are expected to be in the $201 million-$204 million range rather than the expected $204.4 million. Even worse, profits and margins are expected to take it on the chin. Operating margins are expected to fall to 19%-20% from a prior outlook of 21%, while quarterly earnings should come in around $0.22-$0.24 as compared with analysts’ current projections of $0.29. Even the company’s revenue growth rate is expected to tumble down from 16% to 11%-12%.
Now what: Quest highlighted lower than expected return rates from high investment and acquisition costs as the primary reason for the expected earnings shortfall. Thankfully, that leaves hope for rivals Symantec
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