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CTG needs to boost stock price to keep NYSE listing

Any company wants its stock to rise, but Computer Task Group in Buffalo now has an added incentive.

Under a plan it filed with the New York Stock Exchange last week, CTG needs to boost its stock price 22 percent within 18 months in order to keep its listing on the exchange, company officials said.

The Buffalo-based computer services company learned in August that it fell short of the exchange's new requirement for "market capitalization," or the total value of its stock. The minimum rose to $75 million in June, from $50 million.

The deadline to file a plan for meeting the requirement fell Monday.

In its plan, CTG told the exchange it plans to continue improving financial performance, which should lift its share prices and thus raise its market capitalization.

"It depends on a lot of factors, but we think it's achievable," Chief Financial Officer Gregory M. Dearlove said.
Meeting the NYSE's target will mean achieving a share price of about $4.48, from the current value of $3.70.

The company has also said it could apply to list its shares on the Nasdaq stock exchange. However, Nasdaq requires a minimum share price of $5 for initial listing, according to the exchange's posted rules.

Lacking a listing on a major exchange can leave companies out of analysts' coverage and exclude them from mutual funds that focus on exchange-traded stocks.

Headquartered on Delaware Avenue, CTG provides computer staffing and project support for corporate clients, who include IBM and M&T Bank. Its operations in North America and Europe employ about 3,300 information technology professionals.

CTG is seeing heated growth in sales this year, and higher profits should follow, Dearlove said, driving up the stock's value.

The NYSE disallowed 4 million shares from CTG's market capitalization -- 19 percent of total shares -- because they are held by a trust for CTG employee compensation. The company disputed the action, but was overruled. "We agreed to disagree about that," Dearlove said. "They have their rules."

e-mail: fwilliams@buffnews.com

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