Robinson Humphrey Ups Opinion on Red Hat

Analyst Terry Tillman cites improvements in the company's business

Robinson Humphrey raised its invesment opinion on Red Hat (RHAT ) to buy.

Analyst Terry Tillman said it's nice to see after several quarters of mild misses on the revenue side, an upside achieved in high margin subscription revenue. It appears that a recently installed senior sales and operating management team is starting to hit on all cylinders. Tillman said visibility seems to be improving into future periods owing to increasing traction with key original equipment manufacturer partners, early signs of productivity out of short-tenured direct sales force, early stages of Linux adoption, and benefits from nascent layered software business. The analyst upped his 29 cents fiscal year 2006 (ending February) earnings per share estimate to 33 cents and his 30 cents fiscal year 2007 estimate to 34 cents. He has a $22 price target.

Before it's here, it's on the Bloomberg Terminal.