UPDATE: Piper Jaffray Downgrades Red Hat to Neutral, Lowers PT on Good Product Pipeline, No Top-Line Catalyst

In a report published Tuesday, Piper Jaffray analyst Mark R. Murphy downgraded the rating on Red Hat RHT from Overweight to Neutral, and lowered the price target from $59.00 to $50.00. In the report, Piper Jaffray noted, “We are downgrading RHT shares to Neutral as the stock has risen 571% since 11/20/2008 and we believe the business is unlikely to sustainably recapture 20%+ top line growth in the near to medium term. We had noted that resellers came in below plan in our Q2 survey, that the data was 'not encouraging' and that we did not foresee a top line catalyst. While we still think the stock could see support in the $40s, improvement might take longer than we had expected. We are reducing our target to $50 to reflect Q2 billings growth of 8%, below consensus of 14%, and a slight downward revision to FY14 revenue guidance to account for FX movement and continued softness in Europe. Billings growth could improve modestly in 2H, but we do not foresee a top line catalyst in the next 12 months.” Red Hat closed on Monday at $52.93.