UPDATE: Piper Jaffray Upgrades Red Hat Following Survey Results Indicating Pole Position to Become Dominant OpenStack Provider

In a report published Wednesday, Piper Jaffray analyst Mark Murphy upgraded Red Hat RHT from a Neutral rating to an Overweight Rating and increased the price target from $50.00 to $53.00. In the report, Piper Jaffray says "We are upgrading RHT shares to OW and lifting our price target to $53 for four primary reasons. First, our latest survey work shows that Red Hat is in pole position to become the dominant OpenStack provider, ranking well ahead of IBM and Rackspace in what we view as the most Linux-like opportunity Red Hat has seen in a decade. Second, we expect RHT's Services revenue growth to accelerate toward 20% next year as it builds out support for OpenStack. Third, our mid-quarter checks suggest RHT's billings growth could pick up toward the low teens in the next two quarters. Fourth, RHT shares have underperformed versus the S&P 500 by 20 percentage points in the last 7 weeks, resulting in a depressed cash flow multiple of 13x heading into a three-quarter period of easy billings comps." Red Hat closed on Tuesday at $44.60.