Citrix Systems upgraded to “buy” - update

02/23/04 - Banc of America

NEW YORK, February 23 (New Ratings) – Analysts at Banc of America Securities upgrade Citrix Systems Inc (CTXS) from “neutral” to “buy.” The target price has been raised from $24 to $27.

Shares of Citrix Systems, a global provider of access infrastructure software and services, are currently trading at $20.41.

According to Banc of America Securities' research note published this morning, Citrix Systems' product pipeline is robust due to its Metaframe Access Suites. The analysts believe that the company is likely to outperform the 2004 and 2005 estimates. Given the company's solid cash flows and balance sheet, the stock has an attractive risk/reward ratio at its current valuation levels, the analysts say.

The analysts mention that Citrix Systems intends to improve its exposure to enterprise level markets in the forthcoming quarters, in order to widen its revenue base. Moreover, the company has been witnessing consistency in its US channel businesses, the analysts add. According to Banc of America Securities, the company's proposed acquisition of Expertcity would be accretive to the 2005 earnings.

The EPS estimates for 2004 and 2005 are $0.83 and $0.90. The P/E estimates for 2004 and 2005 are 24.6x and 22.7x, respectively.

Banc of America Securities upgrades Citrix Systems Inc from “neutral” to “buy.”