Brocade Communications (BRCD): Takeout Possible But Its In The Stock - Baird
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Baird analyst, Jayson Noland, reiterated his Underperform rating on shares of Brocade (NASDAQ: BRCD) but raised his price target to $9 from $8 after Bloomberg reported that Brocade is in “advanced talks” to sell itself to Broadcom (Avago).
The analyst sees the rumor as credible given the secular pressure on Brocade’s FC SAN business and the M&A spree Avago has been on the last few years. As such, we are raising our price target to $9 but keeping our Underperform rating as we believe most of a take-out is already priced and there is a chance a deal doesn’t get done.
Shares of Brocade closed at $10.60 yesterday.
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Related EntitiesRobert W Baird, Jayson Noland
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