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BMC Adds Two New Clients

Zacks Equity Research

Winning deals and getting new clients has become a regular affair for BMC Software (BMC). The company will be offering its software-as-a-service (SaaS)-based Remedy OnDemand to Royal DSM, which is expected to expand its corporate IT offerings and improve customer satisfaction.

Royal DSM will migrate to the BMC Remedy OnDemand solution from the BMC Remedy IT Service Management (ITSMF) Suite. The BMC Remedy OnDemand solution will benefit Royal DSM’s corporate IT service delivery.

The selection of this SaaS-based solution will help Royal DSM to increase its service management capabilities, which will help them to better manage its customers. This new implementation is expected to improve the process execution capabilities of the company.

Moreover, BMC has also recently secured an order from the Generali Deutschland Group. The life and general insurance company has deployed the BMC CMF MONITOR solution, which is expected to help the German company lower its mainframe costs, and improve its performance and capacity data to meet customer needs.

We believe that the BMC CMF MONITOR solution will find many takers, as it makes life easier for insurance companies. BMC has been enjoying a steady flow of deals and is also witnessing steady growth in its SaaS-based business. Cloud bookings have also improved. Though BMC’s first quarter results were modest, we believe that the series of deal wins could have a positive impact on next quarter’s revenue.

However, significant Fed budget cuts have had an impact on government funds for IT administration. This apart, the economic weakness in Europe is also affecting business. Additionally, heightened competition from big industry players such as IBM Corp. (IBM), Hewlett-Packard Company (HPQ), EMC Corp. (EMC) and CA Technologies (CA) remains a concern.

Currently, BMC Software has a Zacks #3 Rank, indicating a short-term Hold rating.

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