Sterling Research raised its target price on
and reiterated its buy investment rating, citing, in part, the growing interest in Linux open source software.
The research firm's new target price is $7, up from $5, and the potential exists for upward adjustments. Sterling said it sees the company's market share position for its Linux/Unix servers and its application server software gaining ground.
Also, strong euro vs. dollar comparisons and Linux's increased reputation as a viable operating system could increase Sun's revenue and earnings. Analysts, on average, expect Sun to break even for the full year and earn 2 cents a share in the current fourth quarter.
Shares of Sun were up about 7.5% in morning trading to $5.29 following Sterling's comments.