UPDATE: Credit Suisse Reiterates Neutral Rating, Raises PT on Informatica Corporation Following Good Q4 Revenue

In a report published Wednesday, Credit Suisse analyst Michael Nemeroff reiterated a Neutral rating on Informatica Corporation INFA, and raised the price target from $35.00 to $40.00. In the report, Credit Suisse noted, “INFA's Q4 revenue results were above consensus coming in closer to our estimates, while EPS was $0.02 better than our well-above Street estimate of $0.54 (mostly due to a $0.03 benefit from a lower than guided-to tax rate). Mgmt guided 2015 revenue modestly below but their EPS guide was much lower than consensus, which was somewhat cushioned by providing a new LT target operating model (through 2018) that shows an acceleration in software revenue largely driven by continued hyper-growth in subscriptions, which we view as achievable, but not easy. Despite what appears to be a normally strong seasonal Q4, INFA shares have recently traded, and will probably continue to trade higher based on the possible outcome of an activist shareholder's recent 13D filing, rather than the company's reported and guided to business fundamentals. If we value INFA shares purely based on mgmt's near-term business outlook we think the shares are overvalued at more than 24x our new lower 2015 EPS estimate of $1.68 (previously $1.75). Conversely, we recognize that INFA shares could look attractive to a potential LBO investor in the $40-45 range, roughly where the shares are currently trading. Reiterate Neutral but increase target to $40 due to a higher potential acquisition premium.” Informatica Corporation closed on Tuesday at $43.12.