RPX Corporation downgraded by Barclays

Barclays downgraded

from overweight to equal weight on the back of weak guidance, despite the earnings beat: “RPXC reported 2Q14 EPS of $0.24 (above both our and the consensus estimate of $0.22). The 2c beat vs. our estimates in the quarter was equally driven by better-than-expected top-line growth and expense management. Overall, we believe that 2Q results were both clean and strong.” The reasoning for the downgrade: “We see increased uncertainty around subscription growth. While we are impressed by the company's sustained 90%+ renewal rate, we note that more conservative assumptions with respect to expense growth at rates similar to '14 levels and reduced fee income would result in 2015 EPS of $1.02, well below consensus. As a result, we are downgrading the stock to EW from OW and taking our target price to $17 (~15xFY15 EPS) from $20.” RPX Corporation is down by 2.58 percent on the Monday session. Despite the downgrade, the stock is trading at $15.12, which is below Barclays' $17 price target on the stock.