Deutsche Bank Cuts Price Target on Red Hat (RHT) to $90 Following 3Q Report
Deutsche Bank maintained a Buy rating on Red Hat (NYSE: RHT), and cut the price target to $90.00 (from $95.00), following the company's 3Q earnings report.
Analyst Karl Keirstead commented, "RHT posted disappointing 3QF17 results. FX-adjusted billings growth of 10% was well below our 15% estimate, subscription revs growth of 18% c/c was slightly below our 20% estimate and OCF of $136m (flattish y/y) missed our $196m estimate. RHT set 4QF17 revs guide below our estimate, lowered its FY17 OCF guide and the CFO is leaving to take a CEO role elsewhere. RHT pinned the blame on shorter invoicing durations, deals closing late in the quarter and a few slipped govt deals. After soft prints from ORCL, WDAY, PANW and now RHT, 4Q16 is not shaping up to be a robust quarter. Reiterate BUY on attractive risk/reward."
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Shares of Red Hat closed at $79.79 yesterday.