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Shares of PeopleSupport Rise a Day After Stock Declines on Lost Contract, Downgrade


NEW YORK (AP) -- Business process outsourcing company PeopleSupport Inc. rebounded Tuesday after an analyst upgraded the stock, saying the recent sell-off in shares presents a buying opportunity for investors.

Friedman Billings Ramsey analyst Matthew J. McCormack said Monday's sell-off on concerns related to a lost contract with Vonage Holdings Corp. may open the door to an activist shareholder or even prompt a bid for the entire company.

"The shares are likely a good entry point for a trade," McCormack wrote in a client note, but also warned the stock will be volatile until management quantifies the Vonage loss.

American Technology Research analyst Brad Manuilow, who has a "Buy" rating on the shares, also said the pullback marks an attractive entry point for investors. He lowered his price target by $10 to $20.

"We would be buyers of the stock at current levels "