Oppenheimer Reports on Ariba, SuccessFactors, and Google

Oppenheimer commented on Ariba ARBA, SuccessFactors SFSF, and Google GOOG in a report released today. On Ariba, Oppenheimer writes, "Earlier this week, we traveled with ARBA and believe it is on track to post another solid bookings quarter. The ASN (Ariba Supplier Network) should continue to lead the way as volume growth, expanding chargeable relationships, and high retention rates (despite last fall's price increase) should enable this business to sustain ~50% organic growth. We believe mgmt's 20-30% LT ASN growth goal is very achievable, especially with new product introductions (Discovery) and expanding customer usage. ARBA's eBay for the enterprise strategy is accelerating, but with the stock valued at ~29x our adjusted CY12E FCF/shr of $1.10 and given the company's subscription growth profile, we expect the shares to trade in line with the group over the near term." On SuccessFactors, Oppenheimer writes, "On Thursday, SFSF announced it has expanded its relationship with Ceridian, a leading provider of HR, benefits administration, payroll, workforce management and tax filing solutions. While the two companies have been working together since 2009 (Ceridian provides performance management services), under the augmented relationship SFSF will now integrate Ceridian's payroll, time and attendance and tax filing solutions into the its Employee Central 2.0." On Google, Oppenheimer writes, "On Thursday, GOOG (along with C, MA, S, and First Data) demonstrated Google Wallet, an app that turns a smartphone into a virtual credit card. Similar to a traditional PayPass MasterCard, consumers will be able to make payments by waving their smartphone near a PayPass-enabled checkout terminal. GOOG plans to integrate Google Offers (its recently announced deal-a-day offering that competes against Groupon and LivingSocial) with Google Wallet to offer a variety of electronic discounts and promotions when payment is made with Google Wallet. Based on near field communication (NFC) technology, Google Wallet is in a "field test" in New York and San Francisco. Wider availability is expected later this summer on the Nexus S 4G smartphone on the Sprint network." Oppenheimer has a Perform rating on Ariba, an Outperform rating on SuccessFactors, and an Outperform rating on Google. On Thursday, Ariba closed at $33.22, SuccessFactors closed at $33.79, and Google closed at $518.13.