Red Hat Stock Gets Upgrade - InformationWeek
IoT
IoT
Government // Enterprise Architecture
News
12/10/2010
11:19 AM
50%
50%
RELATED EVENTS
Faster, More Effective Response With Threat Intelligence & Orchestration Playboo
Aug 31, 2017
Finding ways to increase speed, accuracy, and efficiency when responding to threats should be the ...Read More>>

Red Hat Stock Gets Upgrade

Analysts expect good things from the Linux developer due to its strength in renewing major contracts.

Red Hat's stock is rising, with several investment firms rating the company "overweight" after an RBC analyst upgraded its rating to "outperform" from "sector perform."

RBC analyst Matthew Hedberg on Wednesday advanced the company's stock, in part because of Red Hat's high success rate at renewing contracts. The developer's client list includes heavyweights such as Amazon.com, IBM, Nippon Telegraph & Telephone, and Qualcomm. In addition, Red Hat saw strong demand in the third quarter, with high renewal rates on large contracts, said Hedberg.

Red Hat's JBoss business, which provides virtualization management products, has been doing well, and the company is aggressively hiring, an indicator of strong demand, he added. In fact, Red Hat's third-quarter revenue could exceed RBC's current estimate of $227.1 million to $229 million, as well as Red Hat's own guidance for revenue between $226 million and $228 million, said Hedberg. Final results of the quarter are expected after the market closes on Dec. 21.

Equities research analysts at UBS AG increased their price target on shares of Red Hat from $44 to $50. Currently, there is a "buy" rating on the stock.

Likewise, Piper Jaffray upgraded shares of the company from a "neutral" to an "overweight" rating, and a price target of $50. Morgan Stanley this week also upgraded shares to "overweight," and created a $55 price target on the stock.

On Thursday, Red Hat was said to be considering offers from several cities and developers that were attempting to lure the Raleigh, N.C.-based developer from its current headquarters, according to Capitol Broadcasting. Currently, the company occupies two buildings that take up less than 200,000 square feet in the N.C. State's Centennial Campus, but Red Hat is said to be looking for up to 300,000 square feet of space.

One executive said to be very familiar with the situation in Raleigh said that a "number of cities" have made offers to Red Hat, according to the report. Red Hat CEO Jim Whitehurst declined to comment on the rumors.

Comment  | 
Print  | 
More Insights
Comments
Threaded  |  Newest First  |  Oldest First
How Enterprises Are Attacking the IT Security Enterprise
How Enterprises Are Attacking the IT Security Enterprise
To learn more about what organizations are doing to tackle attacks and threats we surveyed a group of 300 IT and infosec professionals to find out what their biggest IT security challenges are and what they're doing to defend against today's threats. Download the report to see what they're saying.
Register for InformationWeek Newsletters
White Papers
Current Issue
IT Strategies to Conquer the Cloud
Chances are your organization is adopting cloud computing in one way or another -- or in multiple ways. Understanding the skills you need and how cloud affects IT operations and networking will help you adapt.
Video
Slideshows
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Flash Poll