Kenexa (KNXA) Revenue Growth To Be Driven By Favorable Booking Trend
Analysts at Longbow Research initiate coverage of Kenexa Corp (NASDAQ: KNXA) with a "buy" rating. The target price for KNXA is set to $17.
Longbow Research expects “to see sustained improvement in U.S. hiring trends, followed by improvement in Europe, which should provide the elixir for the pressure on KNXA’s fundamentals that began in late 2007.” “Market declines have hit KNXA's shares hard, which are down over 60% in the last three years versus a 19% decline for the S&P 500,” the analysts say.
Longbow Research expects Kenexa’s share price to be driven by “continuing sequential improvement in key hiring metrics, which bottomed around 3Q09.” “As hiring activity increases, KNXA will benefit from greater client spend for outsourced recruiting, talent acquisition, and candidate assessments, initially showing up as a positive trend for KNXA’s bookings based on revenue and balance sheet items. We expect this booking trend and recognition of multi-element deals to translate to double-digit revenue growth (Y/Y) by 4Q and beyond,” the analysts say.
