Citrix Systems(CTXS) Soars 20% after Earnings Report; Shares Upgraded

Posted by on Jul 29, 2010 | No comment

Shares of software developer Citrix Systems advanced 19.73% to close at $56.67 in Thursday’s trading, a day after the company reported its financial results for the second quarter ended June 30, 2010. Earlier in the session, the stock hit a new 52-week high when it went as high as $57.70.

Citrix, which develops application delivery software, reported Q2 revenue of $458 million, beating the Street consensus of $436.9 million.  Non-GAAP profit was $78 million, or 41 cents per share, compared to analyst estimates of 45 cents. Excluding a one-time income tax expense of $13 million, the company would have earned 48 cents a share.

Citrix further boosted investor confidence with its outlook for the third quarter and the full year.  The company expects to achieve revenue of $450 million to $460 million with non-GAAP profits of 48-49 cents a share for the current quarter; versus analysts’ view of $446.1 million and 48 cents.

For the fiscal year 2010, the company expects to realize revenue of $1.81 billion to $1.83 billion and profits of $1.87 to $1.89 a share, compared with analysts’ view of $1.79 billion and $1.90.

Commenting in a press release, CTXS president and CEO Mark Templeton stated: “Leading indicators for the second half are solid. We are seeing excellent vibrancy in the channel, higher levels of strategic engagement with our customers, and really good pipeline growth.”

In particular, the Company is seeing strong demand for its product called XenDesktop, the desktop virtualization program designed to allow desktop computers to run applications from other machines over a so-called cloud computing environment.

In a note to clients, Robert W. Baird analyst Steven Ashley, who raised his rating on CTXS’s stock to outperform, wrote that XenDesktop demand continues to accelerate, and we believe the industry has now reached a critical inflection point.” Ashley went on to say that the company “has emerged as the clear industry leader, offering the broadest and most complete offering” in the desktop virtualization segment.”

Joining the bullish camp, Citigroup also upgraded CTXS to Hold from Sell, Cowen & Co. to Neutral from Underperform, and Raymond James to Outperform from Market Perform.

CTXS is currently trading above its 50-day and 200-day moving averages of $45.02 and $45.27, respectively. It has seen support at $44.99 and has met with resistance at $48.6.

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BeaconEquity.com is committed to producing the highest-quality insight and analysis of small-cap stocks, emerging technology stocks, hot penny stocks and helping investors make informed decisions. Our focus is primarily OTC stocks in the stock market today, which have traditionally been shunned by Wall Street. We have particular expertise with renewable energy stocks, biotech stocks, oil stocks, green energy stocks and internet stocks. There are many hot penny stock opportunities present in the OTC market everyday and we seek to exploit these hot stock gains for our members before the average daytrader is aware of them.

Beacon Equity Group Disclaimer

This newsletter is a paid advertisement and is neither an offer nor recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this report or email is not provided to any individual with a view toward their individual circumstances. Beaconequity.com is a wholly-owned subsidiary of BlueWave Advisors.

While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our newsletter is not trustworthy unless verified by their own independent research. Also, because events and circumstances frequently do not occur as expected, there will likely be differences between the any predictions and actual results. Always consult a real licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment.

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