Shares of

Red Hat

(RHAT)

soared Thursday, as technology investors fled from

Novell

(NOVL)

, the Linux vendor's major rival.

Red Hat surged on the strength of positive comments from Goldman Sachs and Merrill Lynch and

Novell's weak second-quarter earnings and disappointing third-quarter guidance.

In recent trading, shares of Red Hat were up $2.02, or 7.7%, to $28.24, while Novell was losing $1.37, or 17.7%, to $6.36.

Analysts at both brokerage houses noted that Red Hat is moving into the software testing market, although it isn't clear when the new service would yield significant revenue. Goldman Sachs is seeking investment-banking business with Red Hat; Merrill Lynch does not have an investment-banking relationship with the company.

A third analyst, Trip Chowdhry of Global Equities Research, earlier this week published a note saying

Oracle

(ORCL) - Get Report

, which has been rumored to be readying its own version of Linux, has decided to drop the effort. His claim could not be verified, and other analysts remain split on the odds of Oracle jumping into the open-source pool. Global Equities Research does not have an investment-banking business.

Goldman Sachs analyst Rick Sherlund said he believes that Chowdhry is wrong, while Kash Rangan of Merrill Lynch said: "The logic behind Oracle getting into Linux distribution (bundling a RHAT clone) is not appealing given the complexity of orchestrating a community (which includes

IBM

(IBM) - Get Report

and

BEA Systems

) and risks that Linux could splinter (which could hurt Oracle). While the street continues to speculate; the overhang should dissipate over time."

There also has been speculation that Red Hat, which recently purchased JBoss, the developer of an open-source application server, might next buy an open-source database company, perhaps MySQL.

But according to Sherlund, who attended a Red Hat investor meeting in Nashville this week, CEO Matthew Szulik said "the company has no explicit intention to move up the stack, and thus acquisitions by the company in the database space are not especially likely at the moment."

Commenting on Red Hat's testing initiative, Sherlund said, "While not a new revenue opportunity today, open-source testing tools are in high demand among enterprise CIOs we have spoken with."