Auriga Maintains a 'Hold' on EMC (EMC); Raising Estimates Ahead of Expected Strong Qtr
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Price: $37.05 -0.16%
Rating Summary:
13 Buy, 25 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
13 Buy, 25 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Auriga maintains a 'Hold' on EMC (NYSE: EMC), PT raised by $1 to $28.
Auriga analyst says, "We are comfortable bumping up our estimates ahead of EMC's July 20 earnings release, as we believe strength in the core storage space and at VMWare (NYSE: VMW) will more than offset any weakness from recent problems at RSA. Longer term, we expect EMC will continue to be a share gaining leader in the very attractive storage space, and its exposure to other high growth markets beyond storage suggests a top-line CAGR of 10%+ is sustainable. We also believe EMC can continue to push margins modestly higher, and thus bottom-line growth of 15%+ appears very possible, placing EMC into the group of elite large cap growth names in the tech space. However, current valuation suggests the rest of the market sees the same positive outlook, so near term stock upside appears limited...As such, we are increasing our 2Q11 (June) revenue and pro-forma EPS estimates to $4.74Bn and $0.33 from $4.69Bn and $0.32 (Street at $4.73Bn and $0.32 EPS on apples/apples basis), despite some reduced assumptions for the security business due to the potential for some fall-out related to the enhanced media scrutiny of the security breach issues at RSA last quarter."
For more ratings news on EMC click here and for the rating history of EMC click here.
Shares of EMC closed at $27.89 yesterday.
Auriga analyst says, "We are comfortable bumping up our estimates ahead of EMC's July 20 earnings release, as we believe strength in the core storage space and at VMWare (NYSE: VMW) will more than offset any weakness from recent problems at RSA. Longer term, we expect EMC will continue to be a share gaining leader in the very attractive storage space, and its exposure to other high growth markets beyond storage suggests a top-line CAGR of 10%+ is sustainable. We also believe EMC can continue to push margins modestly higher, and thus bottom-line growth of 15%+ appears very possible, placing EMC into the group of elite large cap growth names in the tech space. However, current valuation suggests the rest of the market sees the same positive outlook, so near term stock upside appears limited...As such, we are increasing our 2Q11 (June) revenue and pro-forma EPS estimates to $4.74Bn and $0.33 from $4.69Bn and $0.32 (Street at $4.73Bn and $0.32 EPS on apples/apples basis), despite some reduced assumptions for the security business due to the potential for some fall-out related to the enhanced media scrutiny of the security breach issues at RSA last quarter."
For more ratings news on EMC click here and for the rating history of EMC click here.
Shares of EMC closed at $27.89 yesterday.
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