This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Red Hat Drops Despite Earnings Beat (Update 1)

Updated from 4:20 p.m. EST to provide guidance from conference call and latest share price.

NEW YORK ( TheStreet) -- Red Hat (RHT - Get Report) reported better-than-expected third-quarter earnings Monday, but shares fell in after-hours action following the report.

The open-source software company reported non-GAAP earnings of $55.7 million, or 28 cents per share, with revenues totaling $290 million, an increase of 23% year-over-year. The average estimate of analysts polled by Thomson Reuters was for earnings of 26 cents per share on revenues of $289.6 million in the three months ended Nov. 30.

"Red Hat continues to benefit from enterprise customers that are seeking to leverage their IT infrastructure to drive significant productivity gains and agility across their organizations. The combination of strong sales execution, market demand and market share gains contributed to organic billings and revenue growth of 23% for the quarter," stated Jim Whitehurst, the company's president and CEO, in a press release.

On its conference call, the company said that, despite the foreign currency headwinds, it is raising its forecast for the fourth quarter and full year. For the fourth quarter ending in February, it expects earnings of 26 to 27 cents a share with revenue ranging from $289 million to $292 million. Wall Street's current consensus view is for a profit of 26 cents a share in the quarter on revenue of $292.5 million.

For its full fiscal year, Red Hat now sees earnings of $1.07-$1.08 per share. The average analysts' view sits at a profit of $1.05 a share.

Red Hat also said full year operating margins are expected to exceed 26%.

Shares were last quoted at $42.81, down 7%, on volume of around 800,000. The stock is flat in the past year but had already declined 14% based on Monday's regular session close at $46.05 since hitting a 52-week high of $53.42 on Nov.16

-- Written by Chris Ciaccia in New York

>To follow the writer on Twitter, go to http://twitter.com/commodity_bull.

>To submit a news tip, send an email to: tips@thestreet.com

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
RHT $69.78 -0.37%
AAPL $109.76 1.90%
FB $88.28 1.20%
GOOG $605.42 1.30%
TSLA $243.51 2.00%

Markets

Chart of I:DJI
DOW 16,253.77 +195.42 1.22%
S&P 500 1,937.63 +23.78 1.24%
NASDAQ 4,699.7780 +63.6730 1.37%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs