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Siebel gets new fuel with analyst recommendations

Siebel Systems' stock gets new fuel as two analysts raise their outlook for the company following news that quarterly profits and revenue doubled.

Siebel Systems' stock got new fuel as two analysts raised their earnings outlook for the company following news that quarterly profits and revenue doubled.

Siebel's shares jumped $10.25 or 12 percent to $95.38 today after SG Cowen upped its 2000 revenue estimates for the company to $1.26 billion from $1.06 billion. He also raised earnings estimates to 75 cents per share from 67 cents for the year.

Separately, Banc of America Securities analyst Bob Austrian today raised his revenue estimates for Siebel to $1.2 billion from $1.06 billion and his earnings expectations to 75 cents a share from 70 cents. Austrian made his decision following what he called a "mega-blow-out quarter" for the services firm.

In a report issued today, Morgan Stanley financial analyst Chuck Phillips called Siebel's fourth-quarter earnings "a blow-out, pure and simple."

Siebel reported that net income jumped to $45 million, or 19 cents a share, from $19.9 million, or 10 cents a share, a year earlier. Results beat analysts? expectations of 15 cents per share for the quarter, according to First Call.

Revenue more than doubled to $268 million from $128.1 million.

Phillips noted that while competitors SAP and Oracle have tried to make inroads in Siebel's market share, they have yet to make a serious dent.

Strengthening Siebel's position is the company's deal with IBM with more than 3,500 salespeople selling Siebel's product line, Phillips noted. That relationship is expected to contribute new revenue streams to Siebel's first-quarter results, he added.

Additionally, IBM's work with Siebel by the end of the year could rival that of Andersen Consulting. Phillips estimates Andersen is involved in about a quarter of Siebel's software installations.

In other news today, Siebel announced a global partnership with Deloitte Consulting. Under the alliance, Deloitte will help joint customers install Siebel's relationship management (CRM) software that automates corporate call center, field sales and customer service needs.

Prior to today's global alliance, Deloitte and Siebel worked together on projects for Allied Signal Aerospace (Honeywell), AT&T, Charles Schwab, Pitney Bowes, Renault, and Guinness, the companies said.