Digital River (NASDAQ:DRIV) Has Strong Pipeline Heading into 2011

Digital River (NASDAQ:DRIV) appears headed for significant growth in 2011, with FBR Capital citing Microsoft (NYSE:MSFT) and increased margins as major catalysts.

FBR said, "With strong revenue growth on the horizon for 2011, Redmond's confidence boost, and massive margin expansion opportunities, Digital River is well positioned in our view to capitalize on strong secular trends for the coming years...For FY11 we are increasing our revenue estimate to $406.8 million (20% core organic revenue growth) from $403.3 million while our FY12 estimate is moving up to $468.7 million (15% organic growth) versus our prior estimate of $459.6 million...For FY11 we are lowering our EPS estimates from $1.37 to $1.26 while our FY12 estimates move down to $1.71 versus our prior estimate of $1.87."

Digital River closed Friday at $36.68, up by $0.31, or 0.85 percent. FBR has a price target of $42 on Digital and maintains their "Outperform" rating on them.