In a report published Friday, Oppenheimer analyst Ittai Kidron upgraded Aruba Networks (NASDAQ: ARUN) from Perform to Outperform and set a $24.00 price target on continued strength and potential upside.
Kidron remarked on “encouraging” April and July quarter checks, noting “incrementally stronger channel activity QoQ (US and Europe), continued strength in education and healthcare, and more gains from 802.11ac. This reinforces our comfort in mgmt's execution and their ability to drive market share gains in the mid-market and internationally.”
Oppenheimer expects the momentum to continue in July, seeing 42 percent quarter-over-quarter growth and 4 percent tracking for a decline. The analyst expects guidance to be in line with consensus with possible upside from “continued education strength (strong in April with favorable July seasonality) and incremental channel marketing activities.”
On Aruba's Analyst Day on March 12, management outlined attractive and plausible growth opportunities. With shares down approximately six percent following Analyst Day, the analyst sees near-term support and believes FY15 guidance is conservative. Kidron wrote, “We'd be buyers ahead of earnings, seeing good potential for upside.”
Aruba will report third quarter results on May 20, 2014.
Shares of Aruba closed at $20.23 on Thursday and are currently trading at $20.45, up 1.09 percent.
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