Bank of America Merrill Lynch Maintains Buy on Red Hat

Bank of America Merrill Lynch is out with its report today on Red Hat RHT, maintaining Buy. In a note to clients, Bank of America Merrill Lynch writes, "RHT has the potential to scale into a highly profitable $1-2bn revenue company by capitalizing on a shift in the server market towards Linux subscriptions from UNIX, especially in BRIC (Brazil, Russia, India, China). RHT is executing well, gaining share and growing margins. RHT could see a significant reacceleration in billings and cash flow as it emerges from a 1H09 billings growth trough and given its unique position to gain share from a weakening competitor." Bank of America Merrill Lynch maintains a $57 PO on RHT.