Piper Jaffray Reiterates Overweight Rating, $64.50 PT on Red Hat
In a report published Wednesday, Piper Jaffray & Co. reiterated its Overweight rating and $64.50 price target on Red Hat (NYSE: RHT).
Piper Jaffray noted, “We conducted a global survey of 52 RHT resellers and found that they finished 0.7% above plan for Q3, fairly consistent with the Q2 survey results (+1.2% above plan). Survey results in aggregate suggest consistent end-markets, as the observed pace of business up-ticked while the pace of Unix-to-Linux migrations offset this by downticking. Additionally, our detailed discussions about RHEV show partners still view VMware as king, but as RHEV matures customers are more willing to consider it, as the product is rapidly improving and becoming more viable. While we characterize the survey results as only inline and fairly consistent, we note that the setup improves for RHT entering FY13 due to easier billings comps after the February quarter. We continue to believe RHT is one of the best plays into the secular trends of cloud computing, open-source, virtualization and unstructured data.”
Red Hat closed on Tuesday at $52.20.
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