Red Hat (NYSE: RHT) stock traded slightly lower Thursday after JP Morgan reduced its rating to “underperform” from “neutral.”

Analyst John Difucci also set a share value of between $27 and $32, according to Barron’s.

Difucci cited two concerns:

Red Hat’s own projected growth for cash flow, which he believes is too high

Red Hat as a “meaningful player” in the server virtualization space, given competition from VMWare and looming threats from Microsoft, Citrix Systems and Oracle.

Red Hat shares traded at $40.18, down 40 cents, in early afternoon trading.

Its shares have fallen from a 52-week high of $49 in December.

Read the Barron’s report here.

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