Credit Suisse Remains Cautious on CA Despite Good Q2 Report

In a report published Thursday, Credit Suisse analyst Philip Winslow reiterated a Neutral rating and $27.50 price target on

. In the report, Credit Suisse noted, “CA reported Q2 revenue and billings below consensus expectations, but operating margin of 39.8% exceed consensus of 37.7%--driven by cost saving from restructuring and improved margins in the Enterprise business. Both Mainframe and Enterprise revenues continued to decline in Q2, decreasing 3% and 2% year over year at constant currency, respectively, versus 1% growth and 4% decline, respectively, during Q2 FY2014. Current revenue to be recognized declined 1% year over year at constant currency, and revenue backlog of $6.8 billion declined 5% year over year.” CA closed on Wednesday at $27.41.