What Analysts Think of Red Hat Stock after Fiscal 2Q18 Earnings


Oct. 6 2017, Updated 7:36 a.m. ET

Red Hat was one of the top S&P 500 gainers

So far in the series, we’ve discussed the surge in Red Hat’s (RHT) stock and its outperformance in comparison to the entire computer software sector. The better-than-expected performance in the second quarter along with its upbeat fiscal 3Q18 and fiscal 2018 guidance added strong buying momentum to Red Hat stock on September 26, 2017.

Red Hat stock emerged as a top gainer on the S&P 500 on the day of its earnings release, as the chart below shows. Red Hat stock’s upward trajectory could continue in the future, given the company’s strategies and initiatives to report growth.

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Raised rating and price targets

Let’s see what industry analysts think about Red Hat stock after fiscal 2Q18 earnings. Deutsche Bank, which has a “buy” rating on Red Hat stock, raised its price target to $12 per share from the previous $10.

Abhey Lamba, an analyst at Mizuho Securities, is optimistic on Red Hat’s near-term execution and growth momentum and raised fiscal 2018 EPS estimates to $2.78 from the previous $2.37.

Mizuho Securities maintained its “buy” rating on Red Hat stock but raised its price target to $125 from the previous $109. Joel Fishbein, an analyst with BTIG, also shared his optimism on Red Hat’s fiscal 2Q18 earnings and expected growth prospects. He said, “With the multi-product strategy clearly picking up momentum with big customers, we think RHT can maintain double-digit revenue, operating income and EPS growth over the next few years.”


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