Tuesday, KeyBanc Capital upgraded Kenexa Corp. (KNXA) shares to Buy from Hold with a price target of $11. The brokerage increased its 2009 EPS estimate to $0.61 on revenue of $151.0 million from $0.59 on revenue of $147.8 million, and its 2010 estimate to $0.79 on revenue of $161.9 million from $0.72 on revenue of $154.9 million.
Analyst Steven Koenig upgraded the stock to Buy and established a 12-month price target of $11, about 40% above May 11 closing price. KNXA reported first quarter results in line with consensus expectations. More significantly, deferred revenue was up sequentially by about $3 million in a very challenging economic environment.
The analyst believes this increase reflected strong sales of applicant tracking, or ATS, solutions in multi-element deals including consulting and content, and he expects the company to see benefits to its subscription line by the third quarter and beyond.
The analyst sees room for a recovery in KNXA's EV/ revenue multiple, which appears cyclically depressed, as sequential revenue stability emerges later in 2009 and costs remain controlled.
Although the analyst is not modeling a robust recovery for KNXA's recruitment process outsourcing, or RPO, business, he thinks non-RPO consulting and content sales could rebound as a recovery takes root, possibly providing top-line upside.
The analyst increased estimates to reflect better subscription revenue on the strength of KNXA's solution sales in ATS and (secondarily) performance management.
Currently, KNXA is up $1.54 or 19.62% and trading at $9.39.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.