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Red Hat, Inc. (NYSE:RHT) provides open source software solutions to enterprises worldwide. It also offers enterprise-ready open source operating system platforms. The company provides Red Hat Enterprise Linux, an operating system designed for enterprise computing; JBoss Enterprise Middleware that offers a suite of products for developing, deploying, integrating and managing distributed, composite and Web-based applications and services; and Red Hat Enterprise Virtualization for Servers, including Red Hat Enterprise Virtualization Hypervisor, a hypervisor based on KVM technology that converts the Red Hat Enterprise Linux kernel into a virtualization platform; and Red Hat Enterprise Virtualization Manager, a server virtualization management system, which provide capabilities for host and guest operating systems, such as availability, live migration, power manager, storage manager and system scheduler.

Red Hat is scheduled to report its Q1 2013 results on June 20, 2012, after the market closes.

Technical Overview


Key Metrics

  • Market Cap: 10.44B
  • 52-week trading range: 31.77 - 62.75
  • Trailing P/E: 72.20
  • Forward P/E: 37.60
  • Price/Sales: 9.22
  • Price/Book: 7.46
  • PEG Ratio: 2.43
  • Total Debt: 0.00
  • Annual dividend yield: N/A
  • Return on Equity: 10.90%
  • Return on Assets: 5.34%

Recent EPS Actuals vs. Estimates

The company has met or beaten analysts' estimates the last four quarters. In the last quarter, it reported $0.29 EPS, beating analyst estimates of $0.27.

The consensus EPS is $0.27 based on 26 analysts' estimates, up from $0.24 a year ago. Revenue estimates are $310.84M, up from $264.75M a year ago. The median target price by analysts for the stock is $63.00.

Average recommendation: Overweight

Source: Marketwatch

Analyst Upgrades and Downgrades

  • On May 31, 2012, Mizuho initiated Buy rating for the company.
  • On May 4, 2012, Stifel Nicolaus initiated Buy rating for the company.
  • On April 9, 2012, MKM Partners initiated Neutral rating for the company.
  • On March 29, 2012, Oppenheimer reiterated Outperform rating for the company.
  • On March 27, 2012, UBS reiterated Neutral rating for the company.

Latest Developments

  • On April 3, 2012, Red Hat, Inc. announced that INTTRA will implement several solutions from the Red Hat JBoss Middleware portfolio to enhance and speed the delivery of business solutions for the shipping industry.
  • On March 28, 2012, Red Hat, Inc. announced that its Board of Directors has authorized the repurchase of up to $300 million of Red Hat's common stock from time to time on the open market or in privately negotiated transactions.
  • On March 28, 2012, Red Hat, Inc. announced that for first quarter of 2013, it expects revenue to be in the range of $307-$311 million and non-GAAP earnings per share [EPS] to be approximately $0.25-$0.27.
  • On February 24, 2012, The Lanier Law Firm announced a patent infringement lawsuit filed on behalf of Freemont, Calif.-based Twin Peaks Software Inc. against Red Hat Inc. and its Sunnyvale, Calif.-based subsidiary Gluster Inc.
  • On February 22, 2012, Red Hat, Inc. announced that CDLAN, an Italian telecommunications operator and provider of value-added ICT services, has deployed Red Hat Enterprise Virtualization to create a virtual platform for the provisioning of Software-as-a-Service [SAAS] to its customers.
  • On February 9, 2012, Red Hat, Inc. and Arkelis NV, a fully owned subsidiary of SWIFT, the global provider of secure financial messaging services, announced that financial institutions can deploy Arkelis' Advanced Messaging Hub [AMH] on Red Hat Enterprise Linux to manage significant volumes of incoming and outgoing messaging traffic more effectively.
  • On December 18, 2011, Red Hat, Inc. announced that for the fourth quarter of 2012, it expects revenue of approximately $289-$292 million and non-GAAP EPS of approximately $0.26-$0.27.

Competitors

Red Hat, Inc. operates in Application Software industry. The company could be compared to Citrix Systems, Inc. (NASDAQ:CTXS), Riverbed Technology, Inc. (NASDAQ:RVBD), Symantec Corporation (NASDAQ:SYMC), and TIBCO Software Inc. (NASDAQ:TIBX). Below is the table comparison of the most important ratios between these companies and the industry.

Below is the chart comparison with the stock price changes as a percentage for the selected companies and S&P 500 index for the last one year period.

(click to enlarge)RHT Chart

RHT data by YCharts

Competitors' Latest Development

  • On June 12, 2012, Symantec Corporation announced the pricing of two series of its senior unsecured notes in an aggregate principal amount of $1.0 billion, in an underwritten, registered public offering.
  • On June 7, 2012, Citrix Systems, Inc. announced that it has signed a definitive agreement to acquire privately held Bytemobile, provider of data and video optimization solutions for mobile network operators.
  • On May 21, 2012, Riverbed Technology Inc announced that its board of directors approved a $150 million increase to the share repurchase program announced August 19, 2011.
  • On May 2, 2012, Symantec Corporation announced that for first quarter of 2013, it expects revenue between $1.645-$1.660 billion, GAAP diluted earnings per share between $0.18-$0.19 and Non-GAAP diluted earnings per share between $0.37-$0.38.
  • On May 1, 2012, TIBCO Software, Inc. announced that PT XL AxiataTbk [XL], Indonesia's mobile carrier, has chosen TIBCO software to power its new mobile payment solution, expanding its revenue opportunities and bridging economic barriers for the country's unbanked population.
  • On April 25, 2012, Citrix Systems, Inc. announced that for the second quarter of 2012, it expects net revenue to be in the range of $605-$615 million, GAAP diluted earnings per share to be in the range of $0.34 to $0.37 and Non-GAAP diluted earnings per share to be in the range of $0.58 to $0.59, excluding $0.11 related to the effects of amortization of intangible assets primarily related to business combinations, $0.19 related to the effects of stock-based compensation expenses, and $(0.05) to $(0.09) for the tax effects related to these items.
  • On April 25, 2012, Symantec Corporation's Norton and Facebook announced a partnership to help protect Facebook users and make the web a safer place to connect with friends and family.
  • On April 24, 2012, Symantec Corporation announced that for the fourth quarter of 2012, it expects GAAP revenue of approximately $1.68 billion compared to prior guidance of $1.72-$1.73 billion.
  • On April 19, 2012, Riverbed Technology, Inc. announced that for the second quarter of 2012, it expects revenue to be in the range of $193-197 million and earnings per share to be in the range of $0.21-$0.22.
  • On April 18, 2012, TIBCO Software, Inc. announced the pricing of an offering of $525 million aggregate principal amount of its 2.25% convertible senior notes due 2032 (the Notes).
  • On April 16, 2012, Symantec Corporation announced that privately-held Nukona, Inc., is now part of Symantec. Symantec completed its acquisition of Nukona, a provider of mobile application management [MAM], on April 2, 2012.
  • On April 16, 2012, TIBCO Software, Inc. announced that it intends to offer, subject to market and other considerations, approximately $500 million aggregate principal amount of convertible senior notes due 2032 through an offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended.
  • On April 12, 2012, TIBCO Software, Inc announced that it has completed the acquisition of LogLogic, Inc., a privately held company based in San Jose, California, provides scalable log and security management platforms specifically designed for the enterprise and cloud.
  • On April 11, 2012, Citrix Systems, Inc. announced it has completed the acquisition of Podio, a privately held company that offers a collaborative work platform which supports people and teams getting work done the way they want in a social setting.
  • On April 4, 2012, TIBCO Software, Inc. announced that it has entered into a definitive agreement to acquire LogLogic Inc., a privately held company based in San Jose, California that offers one of the industry's scalable log and security management platforms specifically designed for the enterprise and cloud.
  • On April 2, 2012, Symantec Corporation announced that Northeastern Illinois University is using a combination of Symantec's backup and security software solutions to implement an IT consolidation program across virtual and physical environments to simultaneously break down organizational silos, reduce costs, improve backup and tighten messaging security.
  • On March 30, 2012, Symantec Corporation announced that it has completed the sale of Symantec's 49% stake in Huawei Symantec Technologies Co., Ltd. (Huawei Symantec) to Huawei for USD530 million.
  • On March 29, 2012, TIBCO Software, Inc. announced that its Board of Directors has authorized a new share repurchase program pursuant to which the company may repurchase up to $300 million of its outstanding common stock.
  • On March 29, 2012, TIBCO Software, Inc. announced that for second quarter of 2012, it expects total revenue to be $240-$244 million, GAAP earnings per share to be $0.13-$0.15 and non-GAAP earnings per share to be $0.22-$0.23.
  • On March 27, 2012, Symantec Corporation announced that Premiere Global Sportsis using Symantec Protection Suite Enterprise Edition and Symantec Backup Exec to centralize protection of the Company's distributed endpoints.
  • On March 20, 2012, Symantec Corporation announced it has signed a definitive agreement to acquire Nukona, Inc., a privately-held provider of mobile application management [MAM].
  • On March 14, 2012, Symantec Corporation and Experian Inc announced that the two-factor credentialing solution jointly developed by the companies was selected by the Centers for Medicare & Medicaid Services [CMS] to provide Enterprise Remote Identity Proofing [ERIP] and Multi-Factor Authentication [MFA] Credential Services in support of the Affordable Health Care Act [ACA].
  • On February 27, 2012, Citrix Systems, Inc. and Bytemobile, Inc announced the formation of a strategic partnership that will result in the delivery of new solutions for the mobile data market.
  • On January 26, 2012, Riverbed Technology, Inc. announced that for the first quarter of 2012, it expects revenue in the range of $183 million to $187 million and earnings per share in the range of $0.19 to $0.20.
  • On January 25, 2012, Citrix Systems, Inc. announced that for fiscal 2012, revenue is targeted to be in the range of $2.49 billion to $2.51 billion; GAAP diluted earnings per share is targeted to be in the range of $1.88 to $1.97; and Non-GAAP diluted earnings per share is targeted to be in the range of $2.70 to $2.74, excluding $0.41 related to the effects of amortization of intangible assets primarily related to business combinations, $0.71 related to the effects of stock-based compensation expenses, and $(0.26) to $(0.39) for the tax effects related to these items.
  • On December 21, 2011, TIBCO Software, Inc. announced that for the first quarter of 2012, it expects revenue to be $220-$225 million and GAAP earnings per share to be $0.09-$0.10.

Sources: Yahoo Finance, Google Finance, Marketwatch, Finviz, Reuters.

Source: Earnings Preview: Red Hat