J.P.Morgan said it is upgrading BMC Software (BMC) to Neutral from Underweight based on value of maintenance revenue stream. Note mainframe database tools business is experiencing stable pricing environment.

Goldman Sachs said it is downgrading BMC Software (BMC) to Neutral from Buy based on preference for value/turnaround plays in the current market environment. BMC's BladeLogic acquisition delays margin expansion and leaves less cash for share buybacks. Target cut to $37 from $41.

The stocks with the highest risk, Pritchard says, are Citrix Systems (ticker: CTXS), an application-delivery software outfit, and Blade-Logic (BLOG), a maker of data-center software. And, owing to the financial-services industry's turmoil, Pritchard sees business-software makers Computer Associates (CA) and BMC Software (BMC) as somewhat vulnerable.

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Credit Suisse said it is upgrading BMC Software (BMC) to Outperform from Hold based on improving mainframe software pricing environment and the possibility of expanding operating margins. Raised target price to $41 from $34.

"Pro forma operating margins, which better reflect cash flow, have jumped from single digits to about 24% in the past few years, she notes. Shah thinks they can hit the low 30s."

BMC Software (BMC) was downgraded from Peer Perform to Underperform, Bear Stearns said. Valuation call. Core sales could also be weak, following IBM's guidance last night.

Bear Stearns said it is upgrading BMC Software (BMC) to Peer Perform. Core business-mainframe database tools have been stabilized. The company reported a solid quarter with strong cash flow three times that achieved a year ago. Estimates raised.

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Upgraded by Credit Suisse from Underperform to Neutral