Goldman Sachs Reiterates Neutral, Lowers Target to $49 on Red Hat

Goldman Sachs maintains its Neutral rating on Red Hat RHT and lowers its price to $49 from $55 on results that beat revenue and EPS but showed billings below estimates. Goldman Sachs notes, "Revenue of $290 mn and EPS of $0.28 compared to guidance of $288-$290m n and $0.25-$0.26. Billings of $322 mn rose 23% and were in line with the Street. Constant currency billings growth over the past four quarters has been 22%, 25%, 24%, and 32%, implying growth remains stable. CFO was once again strong at $97mn up 36% yoy (consensus $82 mn) driven by a higher contribution from deferred income taxes as well as higher net income as operating margins came in some 200 bp ahead of consensus." RHT closed at $46,05 per share on Monday.