Shares of networking equipment firm Riverbed Technology (RVBD) are up $1.70, or 7%, at $25.20 after Oppenheimer & Co.’s Ittai Kidron raised his rating on the stock to Outperform from a prior “Perform,” with a $30 price target, writing that 26 different interviews of representatives from the sales channel in the U.S. and Europe suggested the company’s Q4 sales were perhaps slightly above the Street’s estimates.
Both the U.S. and Europe seem to have experienced a year-end “budget flush” that has helped Riverbed’s sales, writes Kidron.
New products, moreover, are helping the company this quarter, he thinks:
We anticipate a stronger March quarter than we have seen in the past (down ~2.5% on average since 2008) and for management to guide ahead of consensus. Our checks point to especially strong US demand leveraging a robust pipeline and rising awareness of Riverbed’s products. We’ve raised estimates accordingly.
Kidron expects enterprise sales are starting to come back this quarter after three quarters of decline in a row last year.
Kidron now estimates Q4 sales of $199.5 million, and EPS of 24 cents. That is in line with the average estimate of $200.7 million and 24 cents.
For this quarter, however, he raised his estimate to $197.5 million and 25 cents from a prior $192 million and 24 cents. That is slightly above the average $197 million revenue estimate of analysts and in line with the average 25-cent EPS estimate.
No comments:
Post a Comment