Ultimate Software Group (ULTI): Guidance Raise Could Be The Beginning Not The End - Wedbush
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Wedbush analyst, Steve Koenig, reiterated his Outperform rating on shares of Ultimate Software (NASDAQ: ULTI) and raised his price target to $248 from $242 after a solid increase in guidance that left room for further upside.
The company has been accelerating its implementation project activity throughout FY16, which augurs for meaningful FY17 revenue outperformance. ULTI’s initial FY17 revenue guide (+24% Y/Y) was solidly above consensus (+22%) but the analyst expects the company to have room to raise this guidance to match or exceed FY16 growth rates following 4Q.
The analyst upgraded ULTI shares on Monday from Neutral to Outperform based on likely FY17 outperformance, and he continues to see the current time and share price level as an attractive entry point. Longer term, the analyst thinks ULTI shares can post solid gains as the company sustains a 20%+ top-line growth rate.
Shares of Ultimate Software closed at $215.26 yesterday.
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