01 May 2007

BEAS: The Investigation Continues and Sales Slow

BEA Systems (BEAS) develops integrated infrastructure software. Its products enable customers to implement a service-oriented architecture (SOA) for their enterprises.

Although many companies are facing investigations into their procedures for granting stock options, BEA seems to require more time than most to conduct an internal probe and take appropriate corrective action. The ongoing review is the company's rationale for not filing a 10-Q or 10-K report for the periods ending 31 July 2006, 31 October 2006, and 31 January 2007. We haven't seen a convincing explanation for why the investigation is taking so long.

Today, BEA announced that it anticipates issuing another abbreviated report, rather than complete (or even an approximation of complete) financial statements, when on 16 May it makes its results known for the April 2007 quarter.

In addition, the latest announcement re-awakened concerns that the company might be having competitive problems. Those fears were realized today with the statement that BEA faced a "difficult selling environment" in the latest quarter.

The stock price dropped considerably as a result of the news.

No comments:

Post a Comment