Piper Jaffray Reiterates Underweight Rating on Ultimate Software Group (ULTI)

Piper Jaffray is out with a research report this morning, where it reiterates its Underweight rating on Ultimate Software Group

; it has a $31.00 price target on the stock. The PJ analysts cited the company’s most recent earnings report, which was mixed versus Street and Piper Jaffray estimates. The company also guided Q3 below consensus, though maintained FY 2010 guidance. The PJ analysts were impressed that the company continues steady recurring revenue growth, “indicating ongoing market share gains.” While the Piper Jaffray analysts applaud the strong recurring revenue growth, they note that ULTI will need to produce an unusually strong Q4 to achieve 2010 guidance. They think that the company’s 2012 and 2013 targets are “stretch goals.”