Needham & Company Maintains a 'Buy' on Taleo Corp (TLEO); Accelerating Billings Growth Suggests the Strength of Trends

Needham & Company maintains a 'Buy' on Taleo Corp (NASDAQ: TLEO) price target cut $1 to $43.00.

Needham analyst says, "TLEO continues to be a favorite name given accelerating trends, product cycles and favorable risk/reward. For the 4th quarter in a row, app billings growth accelerated (vs. favorable comparison) and was impressive (up 50% vs. up 36% y/y in 2Q vs. up 38% y/y in Q1), up roughly 25% net of legacy acquisition billings (vs. up 22% in Q2). We’re encouraged to see 3 more Fortune 100 Performance management wins in the quarter (so now 13 Fortune 100 in total on PM), which reflects the rising credibility of the product. Compensation turned in its best bookings quarter since the acquisition. Metrics were solid. While management didn’t quantify or specify learn.com contribution or opportunities, our sense is that the team is working on at least a few large fortune 100 opportunities that are tracking well."
"For Q4, management guided revenue to $86-87 million (vs. street estimate of $86.3 million), application revenue to $70-71 million (vs. our estimate of $70 million) and EPS to $0.22-.23 (vs. street of $0.25). For 2012 we are revising up our revenue estimate to $378.4 from $374.7 million and our EPS estimate to $1.15 from $1.14."

For more ratings news on Taleo Corp click here and for the rating history of Taleo Corp click here.

Shares of Taleo Corp closed at $31.35 yesterday.

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