A Bear's Face on Mars Blake Lively's New Role Recognizing a Stroke Data Privacy Day Easy Chocolate Cake Recipe Peacock Discount Dead Space Remake Mental Health Exercises
Want CNET to notify you of price drops and the latest stories?
No, thank you

PurchasePro rises on new COO, analyst talk

PurchasePro (Nasdaq: PPRO) got a boost out of news it has hired a new Chief Operating Officer. Bullish statements from Lehman Brothers helped drive the news home.

Shares were up 3 percent, or 0.31 to 14.25 in early trading Wednesday.

Last night, the company announced it had hired Shawn McGhee the former President of North America for Office Depot, as its new COO.

"We feel this is a strong hire for PurchasePro," said Lehman Brothers analyst Patrick Walravens in a research note.

"We also feel this is a good time for long-term investors to buy PurchasePro," Walravens added. While reiterating a "buy" rating and $60 target price on the stock, he said sequential revenue growth is expected to be 75 percent this quarter versus 10 to 15 percent for the competition.

PurchasePro is trading at 6 times 2001 revenue and 42 times 2001 earnings, well below other B2B players like Ariba (Nasdaq: ARBA) and Commerce One (Nasdaq: CMRC), he added. Both those stocks tumbled Monday, despite mixed messages from analysts.

"We also think upcoming industry events and conferences could serve as a catalyst for PPRO, provided the market is at least somewhat cooperative," Walravens stated.

Though the hiring of McGhee as COO is a positive move, its only one of two moves Wall Street has been waiting for; "The next step is for (PurchasePro) to hire a world class CFO," Walravens said.