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What: Shares of Sourcefire (UNKNOWN:FIRE.DL) were on fire today, rallying by as much as 17% after the company reported earnings.
So what: Revenue in the fourth quarter increased 27% to $67.4 million, well ahead of the consensus forecast of $63.8 million. The company posted adjusted net income of $8.9 million, or $0.29 per share, which was right on target with expectations. CEO Marty Roesch said the company's threat-centric strategy continues to be an important differentiator.
Now what: Sourcefire's revenue forecast was also better than expected, with first-quarter sales predicted to be $56 million to $58 million. The Street was modeling for just $55.3 million. Following the results, Topeka Capital upgraded its rating on the stock from "hold" to "buy" with a $50 price target. Topeka noted that the results dispel recent fears that government and Europe, Middle East, and Africa business was suffering.
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Fool contributor Evan Niu, CFA, has no position in any stocks mentioned. The Motley Fool recommends Sourcefire. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.