The Zacks Analyst Blog Highlights: International Business Machines, EMC, Oracle, Dell and Masimo

Zacks

For Immediate Release

Chicago, IL – September 28, 2012 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include International Business Machines Corp. (IBM), EMC Corp. (EMC), Oracle Corp (ORCL), Dell Inc. (DELL) and Masimo Corporation (MASI).

 

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Here are highlights from Thursday’s Analyst Blog:

IBM’s Butterfly Buy Boosts Storage

 

In a bid to diversify its storage solutions portfolio, International Business Machines Corp. (IBM) has acquired Butterfly Software Ltd, a provider of storage planning software and storage migration tools. Butterfly Software will be integrated into IBM’s Software division.  The financial details of the deal were not available.

Headquartered in the U.K., Butterfly Software provides software applications facilitating data storage, including the conversion of data backup from one format to another in a cost-effective manner. Butterfly provides its storage solutions through its network of vendors and resellers.

Of late, IBM has been acquiring companies in the storage space. Last month, IBM acquired Texas Memory Systems, a privately-held flash memory solutions provider. Texas Memory Systems provides its storage solutions to a number of industries that range from financial, high performance computing, telecom and e-commerce to health care.

IBM has been delivering cost effective, power-efficient enterprise storage technologies and solutions to various organizations. The integration of Butterfly Software and Texas Memory Systems’ offerings will strengthen IBM’s position in the storage market.

According to market researcher Gartner, IBM had a 13.8% market share in the external controller-based (“ECB”) disk storage market in the second quarter of 2012, which shrunk from 15.1% in the comparable quarter of the previous year. Moreover, its revenue from the storage segment dropped 2.4% year over year in a scenario where total revenue from the ECB disk storage market increased 6.7% over the same period of time. IBM’s traditional storage business suffered due to continuing shift to cloud based storage solutions.  

We believe that IBM’s acquisition strategy coupled with its strong product pipeline and expansion into emerging markets will help it to achieve its long-term growth targets. Moreover, IBM intends to spend $20 billion through 2015 on acquisitions. We expect IBM to continue to acquire companies that are strategically important to achieve its 2015 goals.

However, we remain cautious on the overall IT spending environment and believe that macroeconomic concerns are the primary headwinds. Increasing competition from EMC Corp. (EMC), Oracle Corp (ORCL) and Dell Inc. (DELL) is an added concern.

Thus, we remain Neutral over the long term. Currently, IBM has a Zacks #3 Rank, which implies a Hold rating in the short term.

 

Masimo Gets FDA Nod for CCHD Products

 

Masimo Corporation (MASI), a leader in non-invasive monitoring technology for patient care, recently received 510(k) approval from the U.S. Food and Drug Administration (:FDA) for its Masimo Signal Extraction Technology (:SET) pulse oximeters, rainbow SET Pulse CO-Oximeters, and neonatal sensors. These devices have received specific labeling to be used for screening of infants ailing from critical congenital heart disease (:CCHD).

About 3% of all infants die from CCHD in their first year according to the Secretary of Health & Human Services letter to the Secretary's Advisory Committee on Heritable Disorders in Newborns and Children (:SACHDNC). Per the Health and Human Services (HHS), 7 to 9 out of every 1,000 babies born suffer from these kinds of heart diseases. Some are detectable and can be treated by measuring the blood oxygen saturation level.

FDA approval has further bolstered Masimo’s foothold in the pulse oximetry space. This is the first time the FDA has approved a particular labeling, signifying the use of pulse oximeters along with a physical exam to test newborns for CCHD. Recently, the state of California made the usage of CCHD pulse oximetry screening mandatory. Earlier, in September 2011, the HHS included pulse oximetry CCHD screening for newborns as part of the Recommended Uniform Screening Panel.

The Radical-7, Rad-57 and Rad-87 Pulse CO-Oximeters with Masimo rainbow SET, and the Rad-5, Rad-5v and Rad-8 Pulse Oximeters with Masimo SET received the 510(k) clearance. The Masimo SET pulse oximeters and sensors had been approved earlier to measure oxygen saturation level and pulse rate during motion and low perfusion conditions in infants.

In addition, along with FDA clearance, Masimo also initiated the HEART Program (Help Ensure Access to the Right Technology). The program will voluntarily provide free Masimo SET pulse oximeters to hospitals which cannot afford to buy it.

 

 

 

 

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Read the analyst report on IBM

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