Sun Micro: Goldman Downgrades to Sell; Stock Slides
Sun Microsystems (JAVA) shares are coming under pressure this morning after Goldman Sachs analyst David Bailey cut his rating on the stock to Sell from Hold. He cut his target price to $3, from $5.
“Sun’s heavy concentration of financial services, telecom and manufacturing customers and overweight dependence on a secularly declining segment (UNIX servers) put Sun at a disadvantage during this downturn versus more diversified competitors,” he writes in a research note. He says most of this is in the stock–down 79 percent in 2008–but says that a 76 percent uptick in the stock since the beginning of December and a 30 percent move in just the past three days “creates a compelling entry point,” by which he means a chance to short the stock.
