KeyBanc Reiterates Hold on Teradata on Lowered Estimates Following Negative 3Q13 Pre-Announcement

In a report published Tuesday, KeyBanc Capital Markets analyst Matt J. Summerville reiterated a Hold rating on Teradata Corporation (NYSE: TDC).In the report, KeyBanc Capital Markets noted, “We are reducing our 2013E from $3.05 to $2.70, including a 3Q13E (September) of $0.69 vs. $0.69 (down from our prior estimate of $0.78). Our 2014E is also reduced from $3.37 to $3.15. Yesterday after the market close, Teradata announced preliminary 3Q13 revenue and EPS, both of which fell comfortably shy of our forecast and consensus expectations. Additionally, TDC reduced its implied outlook for the balance of 2013, with revenue now expected to be essentially flat compared to 2012 (vs. its prior guidance of the ‘low-end' of +6-10%) and EPS now expected in a range of $2.70-$2.80 (Non-GAAP) compared to its prior view of the “low-end” of $3.05-$3.20. With respect to the 3Q, TDC expects reported revenue to approximate $665 million (vs. our prior estimate of $693 million and consensus of $700 million), representing an increase of 3% total (we had been modeling +7%) and 4% in constant FX (vs. our estimate of +9%). 3Q Non-GAAP EPS is expected to be in a range of $0.69-$0.70 vs. $0.69 in the prior year period and compared to consensus prior to this announcement of $0.81.”Teradata Corporation closed on Monday at $52.58.