Needham & Company reiterated a Buy rating on WageWorks (NYSE: WAGE), and raised the price target to $60.00 (from $55.00), following the company's 1Q earnings report. WAGE reported revenue of $87 million, up 2% Y/Y and above the consensus of $86.3 million. The company recorded $0.33 in EPS, above the consensus of $0.29. Management reiterated guidance for FY16 of $356-366 million in revenue, and $1.35-1.41 in EPS.

Analyst Mayank Tandon commented, "WAGE began FY16 on a positive note, beating consensus estimates on both revenue and EPS. Trends within the consumer-directed benefits space remain favorable as reflected by strong organic growth in the core healthcare, commuter, and COBRA segments. Increased growth opportunities in the commuter segment, the expansion of the large Federal Government deal, and the positive impact of the Ceridian business were encouraging takeaways from the quarter. Management reiterated guidance for the full year, as has been the standard practice after 1Q historically, and introduced 2Q guidance that is slightly below consensus on revenue but above by a penny on EPS. Based on the favorable trends throughout the buisness, we see the potential for upside to guidance and estimates. We reiterate our BUY rating and raise our target to $60."

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Shares of WageWorks closed at $52.82 yesterday.