In-Line Q4 Results Expected for NetApp (NTAP); Elliott Investment Will Take Time to Pan Out
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Price: $207.08 +1.02%
Rating Summary:
23 Buy, 31 Hold, 3 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
23 Buy, 31 Hold, 3 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Lazard Capital is out with a few comments on NetApp (Nasdaq: NTAP) into Q4 results. The firm has NetApp at Neutral with no price target.
Analyst Ed Parker thinks negative sentiment in the storage space is overdone and a virtuous product cycle along with easier comps accelerating growth in the latter part of 2013. He commented, "Despite these positives, we remain concerned about competition, and weakness in OEM, federal, and Europe. The stock has outperformed its closest comp, which may be justifiable given the re-rating of VMware (NYSE: VMW). However, with recent appreciation most likely driven by activist developments, we think NT upside now rests on something meaningful on the capital allocation or strategic front occurring." He prefers EMC (NYSE: EMC).
Fiscal Q413 results should be in-line, Parker notes, given mixed checks. Overly weak North America infrastructure spending should be partially offset by improving trends in April.
On OEM E-series sales, Parker comments, "we think y/y growth in branded product growth is the more important metric, but slowing sales to IBM, ORCL, and others could present an unneeded top-line drag."
On news that Elliott Management took a stake in the company, Parker doesn't see any near-term alterations to the way the company manages its cash. A headcount reduction might be possible.
Parker sees Q4 EPS of 68 cents on revs of $1.77 billion.
For an analyst ratings summary and ratings history on NetApp click here. For more ratings news on NetApp click here.
Shares of NetApp closed at $37.84 yesterday.
Analyst Ed Parker thinks negative sentiment in the storage space is overdone and a virtuous product cycle along with easier comps accelerating growth in the latter part of 2013. He commented, "Despite these positives, we remain concerned about competition, and weakness in OEM, federal, and Europe. The stock has outperformed its closest comp, which may be justifiable given the re-rating of VMware (NYSE: VMW). However, with recent appreciation most likely driven by activist developments, we think NT upside now rests on something meaningful on the capital allocation or strategic front occurring." He prefers EMC (NYSE: EMC).
Fiscal Q413 results should be in-line, Parker notes, given mixed checks. Overly weak North America infrastructure spending should be partially offset by improving trends in April.
On OEM E-series sales, Parker comments, "we think y/y growth in branded product growth is the more important metric, but slowing sales to IBM, ORCL, and others could present an unneeded top-line drag."
On news that Elliott Management took a stake in the company, Parker doesn't see any near-term alterations to the way the company manages its cash. A headcount reduction might be possible.
Parker sees Q4 EPS of 68 cents on revs of $1.77 billion.
For an analyst ratings summary and ratings history on NetApp click here. For more ratings news on NetApp click here.
Shares of NetApp closed at $37.84 yesterday.
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