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SolarWinds: Entering 2015 With Strong Business Momentum

SolarWinds (SWI) delivered Q4 earnings and revenue ahead of analyst estimates. The results would have been even better, but currency headwinds negatively impacted the Q4 top line by $2 million, and they also had a negative effect on the 2015 outlook. The company is now constantly delivering on its promises and the operating margin is well ahead of management's expectations. Given management's conservative nature, I expect that the company will execute ahead of its initial expectations and that a beat-and-raise policy should result in higher revenue and earnings growth and a better than expected margin, which should act as a catalyst for a higher share price in the following quarters. I am reiterating my bullish view on SolarWinds and I am raising my price target from $56.5 to $63.

Q4 highlights

SolarWinds delivered Q4 earnings and revenue ahead of analyst estimates. Q4 revenue increased 21.9% to $118.4 million, which was… Read More …