Red Hat Inc(NYSE: RHT) has reported the adjusted earnings per share of 61 cents in the fourth quarter 2016, which is in line with the analysts’ estimates for the adjusted earnings per share of 61 cents. The company had reported the adjusted revenue growth of 16 percent to $629 million in the fourth quarter 2016, beating the analysts’ estimates for revenue of $619 million. The revenue from subscriptions for “infrastructure” software grew 11% while application-development subscriptions grew 40% to $125 million. As a result, the stock rose over 5.3% in the afterhours market on March 27th, 2017 (Source: Google finance).
RHT had a 30% increase in deals valued at more than $1 million in the fiscal year 2016 and the company had had its first-ever deal worth more than $100 million.
For the first quarter 2017, the company expects the revenue to be in a range of $643 million to $650 million, and the earnings per share are expected in a range of 52 cents to 53 cents, on a non-GAAP basis. That compares to consensus for $642 million and 59 cents of earnings per share by the analysts.
For the full year 2017, Red Hat expects the revenue in a range of $2.72 billion to $2.76 billion, and the earnings per share in the range of $2.60 to $2.64. That compares to consensus for $2.71 billion and $2.59 of earnings per share by the analysts.
Meanwhile Red Hat has introduced a new partner program, that is designed to enable a deeper collaborative go-to-market strategy between Red Hat and participating partner organizations and optimize the value chain for application development and integration projects. The Red Hat Application Platform Partner Initiative, currently is being piloted with a select group of solution-oriented consulting partners in North America, aimed to bring together organizations that share a passion for digital transformation and the power of open source to shape the future. Further Red Hat and its partners are expected to play a valuable role in helping the customers overcome barriers that impede progress, such as complex architectures, rigid processes, and confined platforms.
Moreover, Red Hat has announced a strategic collaboration designed to help enterprises benefit from the OpenStack platform’s speed and economics while more easily extending their existing Red Hat virtualized and cloud workloads to the IBM Private Cloud.
Red Hat stock has risen 12.23% in the last one year (source: Google Finance). According to tipranks.com, 7 analysts has covered the stock while recommending a “Strong Buy”. RHT has an average price target of $94.60, which is a further upside of 15.09%.