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We reaffirm our long-term Neutral recommendation on Citrix Systems Inc. (CTXS - Analyst Report). The company reported strong financial results for the second quarter of 2013. Both revenues and net income outpaced the Zacks Consensus Estimate. Management raised its financial guidance for fiscal 2013.

Why Kept at Neutral?

The global economy is still suffering from fluctuations and is not completely out of woods. Various geo-political concerns in the European, African and Middle East countries have slowed the momentum of economic recovery. This may make Citrix’s near-term financials volatile.

Nevertheless, we believe that the global trend toward virtualization and cloud computing will facilitate Citrix to keep up its momentumin the long term. In our view, business fundamentals of the company remain intriguing as the corporate spending on IT is expected to rise globally in the future. The newly launched XenMobile is gaining huge market traction in the highly lucrative enterprise mobility segment.

Citrix is concentrating on three broad markets: Desktop virtualization, Cloud Infrastructure and networking, and Collaboration and sharing. As desktop virtualization has become the top priority for any IT set-up, Citrix is continuously introducing innovative products to facilitate business flexibility, security and centralized management system.

Meanwhile, the stock price has soared nearly 32.5% over the last year. We believe that Citrix is currently fairly valued. The company is also taking several steps to expand globally and launch various state-of-the-art products.

Other Stocks to Consider

Citrix Systems currently has a Zacks Rank #3 (Hold). However, stocks in this industry which are worth a look are Adobe Systems Inc. (ADBE - Analyst Report), Dealertrack Technologies Inc. (TRAK - Snapshot Report) and Advent Software Inc. (ADVS - Snapshot Report). While Dealertrack currently carries a Zacks Rank #1 (Strong Buy) both Adobe and Advent have a Zacks Rank #2 (Buy).

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