Symyx Technologies, Inc. (SMMX)

Shares of Symyx Technologies Inc. hit a four-year low after the company reported loss in the first quarter of 2007 and gave a disappointing second-quarter outlook. For the second quarter, Symyx expects a loss of 4 to 6 cents per share on $24 million to $26 million in revenue. It has also slashed its full-year outlook, expecting results to range between a loss of 4 cents per share and a 6-cent per share profit, down from a profit of 33 cents to 38 cents per share. The shares of the company have dropped by around 40% till date since the announcement of the results

Symyx Technologies makes high throughput research technologies and research software for its customers in the chemical, energy, pharmaceutical, electronics and other industries. In the recent quarter three chemical companies turned down offers to collaborate with Symyx and four pharmaceutical companies delayed licensing software which further created a negative impact. Moreover a large percentage of revenue for the company comes from two alliance customers which add-ons to the risk as even if either of them were to terminate their relationships with Symyx, it would have a material impact on earnings.

The company’s weak performance along with the weak guidance provided by the management is expected to hit the stock negatively. Backing on the same, it is expected that the company’s stock will see a declining trend for coming months and will disappoint the shareholders.