UPDATE: Auriga Initiates STEC at Sell

Auriga is out with its report today on STEC (NASDAQ: STEC), initiating STEC at Sell.

In its report, Auriga writes, "We believe the Enterprise SSD space will be a very high growth technology segment over the next 3-5 years, but we believe that large new entrants are likely to drive most of the adoption at storage and server OEMs. As such, we see STEC losing significant market share (from 20%+ to sub 10%) while suffering significant Operating Margin erosion (from high teens to sub 10%) over the next 3-5 years. Our 10-year DCF suggests a target price of $7, which is below the current price, thus we initiate coverage with a SELL rating on STEC shares."

Shares of STEC closed Tuesday at $8.96, down 0.99% from Friday's close.