Sector Snap: Software stocks mostly rise

Salesforce shares rose $2.72, or 5.1 percent, to $55.97.

The shares had fallen $12.50, or 18.5 percent, to finish trading at $53.25 on Thursday as investors feared Salesforce is headed for a slowdown as general economic sluggishness makes it harder to sign up new customers. The San Francisco-based company triggered the worries late Wednesday by reporting slow growth in a key category that tracks its future revenue and keeping a financial outlook that was not far off analyst expectations.

In a client note Friday, JMP Securities analyst Patrick Walravens raised his rating for the stock to "Market Outperform" from "Market Perform" and set a $60 price target.

Walravens said investors' concerns are legitimate, but that the company "remains the category leader in an attractive space" and he thinks that "lower expectations and stock price may provide a nice entry point for new investors."

Meanwhile, shares of tax preparation and money management software company Intuit Inc. rose $1.10, or 3.6 percent, to $31.13.

Late Thursday, Intuit reported fiscal 2008 fourth-quarter results in line with analysts' expectations and guidance for the year that was ahead of Wall Street predictions.

Oppenheimer & Co. analyst Scott Schneeberger reiterated his "Outperform" rating and raised his price target for the stock to $36 from $34 in a client note, calling the company's fourth-quarter results "solid" and its outlook higher than he had expected. The analyst also raised his fiscal 2009 earnings estimate.

"We remain drawn to Intuit's resilient business model, laden with recurring revenue and brands that hold strong positions in niche categories with compelling growth characteristics," he said.

Elsewhere in the sector, shares of the world's largest software company, Microsoft Corp., rose 54 cents, or 2 percent, to $27.72, while shares of publishing and design software maker Adobe Systems Inc. rose 12 cents to $44.63.