Red Hat Earns Upgrade

CIBC upgraded shares of Red Hat (RHT Quote - Cramer on RHT - Stock Picks), saying the Linux software distributor appears to be positioned well against its competition.

The firm lifted its rating on Red Hat to sector-outperformer from sector-performer and set a $26 price target on the stock. CIBC believes that recent competitive initiatives from Oracle (ORCL Quote - Cramer on ORCL - Stock Picks), along with Microsoft (MSFT Quote - Cramer on MSFT - Stock Picks) and Novell (NOVL Quote - Cramer on NOVL - Stock Picks), haven't yet cut into Red Hat's business.

Additionally, the upcoming RHEL5 product cycle should accelerate adoption rates and give Red Hat the chance to appeal to its existing customers, CIBC said.

Shares of Red Hat closed Thursday at $20.96.