02.02.08
Do-No-Evil Saturday - Part III: Financial Lift for Novell, Courtesy of Jefferies
Early in the week, Novell received an upgrade from Egbert, the lady who apparently likes Oracle and predicts doom for Red Hat.
Egbert also notes that the company is “sitting atop a pile of cash” - $1.3 billion, or about $3.64 a share. That is well over half of the current market cap. She thinks a share repurchase would be a logical step, and notes that a $500 million buyback could boost EPS by about 5 cents. She currently sees EPS of 23 cents in the October 2008 fiscal year and 27 cents in 2009.
Egbert was getting it wrong on Red Hat very repeatedly, but whether you choose to pay attention or not is up to you really. Abhey Lamba is no better by the way. Here is some more information about the effect of Jefferies twitting:
Novell rallies in premarket after Jefferies upgradeShares of Novell Inc. (NASDAQ:NOVL) rallied in premarket trading Tuesday after Jefferies (NYSE:JEF) & Co. upgraded the software company, citing expectations that revenue will stabilize and margins will gradually improve through 2008.
You are probably aware by now that we know how the analysts industry really works. Here is another little update about Novell.
TheSUBWAY.com names the following stocks to its Stock Alert List: AgFeed Industries, Inc. (NasdaqGM:FEED - News), YRC Worldwide Inc. (NasdaqGS:YRCW - News), People’s United Financial, Inc. (NasdaqGS:PBCT - News), Novell, Inc. (NasdaqGS:NOVL - News).
While we didn’t bash Novell (we do not generally do this in Do-No-Evil Saturdays), we did bash some analysts who comment on technology companies without having technical knowledge. Instead, they rely on numbers and graphs, some of which may be badly affected (or faked) by Novell’s book-cooking habits. █
Highlight: Novell was the first to acknowledge that Microsoft FUD tactics had substance. Novell then used anti-Linux FUD to market itself. 
Highlight: Xandros let Microsoft make patent claims and brag about (paid-for) OOXML support. 
Highlight: Linspire's CEO not only fell into Microsoft arms, but he also assisted the company's attack on GNU/Linux. 
Highlight: Microsoft craves pseudo (proprietary) standards and gets its way using proxies and influence which it buys. 
Highlight: The invasion into the open source world is intended to leave Linux companies neglected, due to financial incentives from Microsoft. 
Analysis: Xen, an open source hypervisor, possibly fell victim to Microsoft's aggressive (and stealthy) acquisition-by-proxy strategy.