After today, Riverbed Tech has become the largest position in both the Growth and Opportunistic Portfolios.
Details on the earnings report from Reuters:
*Q2 adj. EPS $0.25 vs est. $0.22
* Q2 rev $126.2 mln vs est. $119.4 mln
* Sees Q3 EPS $0.27 vs est. $0.24Product sales rose more than 40 percent, marking its fourth consecutive quarter of product revenue increase, the company said in a statement.
After the results, S&P analyst Ari Bensinger upgraded the stock to "hold", saying that the networking equipment was experiencing a solid rebound in demand from the enterprise sector.
"While we still see a lagging recovery in Europe, we do not see weakness pronounced enough to impact strong operating trends in other geographies," he added.
Bensinger raised his price target on the stock by $10 to $33.
Always interesting to see what negative analysts do after a report that clearly surpassed their wildest thoughts. He upped his target by nearly 45% which is an incredible amount. This is so much more telling then a bullish analyst going from say $35 to $40.
Considering the size of the stock in our portfolios, we'll likely look for opportunities to prune the holding size. Otherwise, RVBD is in the sweet spot of the expansion of networks and the move to Cloud Computing. Considering its just the Q2 report and tech doesn't usually heat up until late Q3, this stock could have a big run ahead.