Sage share price slips

Accountancy software giants Sage Group saw its share price drop 6.8p
yesterday to 194.2p as analysts predicted the company is extremely vulnerable to
a downturn.

The technology company which is the biggest provider to the SME market saw
its price cut as JP Morgan changed its rating from neutral to underperform the
Daily
Telegraph reported.

The fbank argued that the company’s shares would decline as ‘organic growth
decelerates in a difficult macro environment and competition remains high in the
small and medium enterprise sector’.

Analyst Manoj Singla found that the bulk of revenues for Sage came from the
UK and US which he said are: ‘The two key areas that are seeing economic
slowdown.’

‘Sage is a company with a single-digit growth profile and even a moderate
drop-off licence growth can hit top line growth significantly unless services
growth can accelerate (unlikely in our view)’ he said.

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