UPDATE: Wedbush Maintains Neutral Rating, Lowers PT for Brocade Communications

In a report published earlier today, Wedbush Securities Inc. maintained its Neutral rating for Brocade Communications Systems, Inc.

and slightly lowered its price target from $6.00 to $5.50. Wedbush went on to say “FQ2 revenue and EPS modestly exceeded expectations as the SAN business offset ongoing issues in the Ethernet business which fell q/q and y/y, as expected. Positives in the quarter included better-than-expected sales of storage, growth in sales to service providers, and higher-than-expected margins (due to storage mix). Negatives included execution issues and competition within the Ethernet segment. Q3 guidance was mixed as macro uncertainty and weakness in Federal is likely to create near-term headwinds. While we think the SAN strength continues to be a positive, we think the ongoing weakness and lost share within the Ethernet business is a significant issue which is only being addressed now. Given the uneven spending environment and an intense competitive environment, we advise investors to remain on the sidelines until more visibility into fundamentals emerges.” Brocade Communications Systems, Inc. closed yesterday at $4.94