BMC Further Broadens Vision for Next-Gen Data Center

3/14 - "With the transaction representing approximately 8.5 times estimated calendar 2008 sales for BladeLogic, we view the purchase price as slightly expensive given that we estimate the deal to be approximately $0.12 dilutive to fiscal 2009 EPS estimates assuming no cost synergies. However, we believe BladeLogic’s data center automation suite to be highly complementary with minimal overlap to BMC allowing for meaningful revenue synergies over time...With the deal leaving approximately $600 million of cash on the balance sheet, we continue to believe that the company will ultimately spend upwards of $500 million in share repurchases in fiscal 2009."

"We have revised our FY2009 forecast to EPS (ex. ESO) of $2.11 per share on $1.934 billion in revenue, as compared to our previous estimates of EPS of $2.22 on $ 1.841 billion in revenue...We are maintaining our Outperform rating and our price target of $41 (based on our increased cash flow assumptions), which represents a NTM unlevered EV/FCF multiple of 14.2x."