Ahead of the Bell: Double-Take Software

(AP) — Double-Take Software was downgraded by an Oppenheimer analyst who wrote Thursday that recent signs of stabilization in the market the company serves have been misleading.

Analyst Shaul Eyal downgraded the provider of data backup systems to "Perform" from "Outperform" Thursday and removed a target price of $12. Eyal did not give a new target price.

On Wednesday, Double-Take posted a 4 percent increase in its fourth-quarter profit, but it was fueled by a tax benefit as revenue fell below Wall Street's expectations.

The company also forecast first-quarter and full-year results well below analyst estimates and its shares slid 13 percent in after-hours trading.

"It remains to be seen if steps taken by (Double-Take) to invest for growth bear fruit but until then we move to the sidelines," the analyst wrote in a note to investors.

Eyal added it's likely that the company's growth will "continue to be challenged given paucity of new product adoption and new license sales especially in the firm's bread-and-butter (small to medium-business) market."