Morgan Stanley, Credit Suisse Comment On Bazaarvoice

Bazaarvoice Inc BV beat Q2 expectations Tuesday and reported EPS of $(0.05) vs. the estimated $(0.09) while revenue came in at $47.30 million vs. the estimated $46.67 million.

The stock opened higher Wednesday and recently traded at $7.79, up 4 percent.

Credit Suisse and Morgan Stanley commented on the company after its earnings report. Below are highlights along with current ratings and price targets.

Credit Suisse - Outperform, $11 price target

“The outperformance was on the volume side as client implementations from the pipeline came in ahead of the key retail selling season; this was offset by ARPU decline as a result of greater mix shift to onboard new clients at a lower price point.

“Media Revenue again outperformed our estimates and we remain optimistic for the long term prospects for this segment.

“Management called out a strategic shift in its strategy for International expansion as it will in the near-to-medium term target e-commerce merchants/retailers to first build out the network and enhance the value proposition for brand customers.

“Our investment thesis remains unchanged as Bazaarvoice continues to execute on its path of self-help, and we maintain our Outperform rating.”

Morgan Stanley - Equal-weight, $9 price target

“Q215 call was upbeat as BV puts the DoJ case behind them, rev. growth accelerated again, guidance moves higher, and new products take hold. Valuation at 3x EV/Sales should limit downside vs. our new PT of $9, while further reaccel could drive the stock towards our $14 bull case.

“Major performance metrics continue to show improvement, with 117 new customer launches in the quarter, +36 percent YoY, while dollar retention exceeded customer retention of 95.3 percent. New products like Curations and Local are seeing good early interest from customers, with management particularly pleased with the early response to Curations.

“The company flagged lumpiness in Europe as a focus area for improvement, but was generally happy with how the U.S. businesses is performing. Management also noted that since the end of Q2, November came in strong, while the pipeline for H2 looks healthy.”