Websense shares tumble after Morgan Stanley downgrade; analyst sees risk from Europe
By APThursday, July 15, 2010
Websense tumbles after Morgan Stanley downgrade
NEW YORK — Websense Inc. shares tumbled Thursday after a downgrade from Morgan Stanley, which expressed concern that economic trouble in Europe could hurt the company.
THE SPARK: In a client note, Morgan Stanley analyst Keith Weiss lowered his rating on Websense to “Equal-weight” from “Overweight.”
THE BIG PICTURE: Websense, which provides Internet filtering and security software, has seen billings rise from last year, when many businesses were clamping down on technology spending because of the recession.
THE ANALYSIS: But Weiss said “mounting European concerns” may pose a risk to the company’s share price. Websense generated about 13 percent of its revenue in the U.K. in the first quarter.
Furthermore, Weiss said it may be tough for Websense to keep up enough momentum going into next year to beat this year’s results.
SHARE ACTION: Websense shares fell 81 cents, or 3.8 percent, to $20.36 in afternoon trading.
