Broker snap: Panmure ups Micro Focus forecasts ahead of results

16th Jun 2011 11:20

Panmure Gordon raises its forecasts for Micro Focus International ahead of its final results and a potential bid.The broker said that the software firm's results for the year ended 30 April will give the detail on how the company managed to "pull a rabbit out of the hat" to achieve 'in line' results."Following the results, Micro focus needs to pull another rabbit out of the hat and get a bid for the company. With two potential bidders already identified (Bain Capital and Adent International) we see outcomes ranging from no bid, single bid, competitive bid, trade bid to 'cosy' bid," said analyst George O'Connor.Due to reduced salary costs (as a result of less staff after a restructuring) and some top line growth, the broker raises its adjusted EBITDA (earnings before interest, tax, depreciation and amortisation) estimates for the year-ended April 2012, from $132.3m to $162.6m.The target price is raised to 450p, from 427p, and a 'buy' rating its kept.---BC