Speculation Keeps Driving Business Objects Higher

Friday morning, Credit Suisse’s James Clark cut his rating on Business Objects (BOBJ) to Neutral from Outperform, with the stock having blown past his $46 price target. But does the market care? Noooooo. That’s because the driving force for Business Objects shares is the ongoing speculation that SAP (SAP) - or Oracle (ORCL), or maybe someone else - is about to swoop in and buy the company.

In his note Friday morning, Clark said that the company “would offer value to a strategic acquirer in the software space,” but he does not factor a takeover premium into his target price calculation.

Meanwhile, Clark says that the company’s third quarter results could be affected by the recent strength of the Canadian dollar; he notes that BOBJ has 14% of its costs but just 4% of its revenues in the Canadian currency.