UPDATE: Wedbush Reiterates Neutral Rating, Lowers PT on Riverbed Technology on Weaker Q4 Revenue
In a report published Friday, Wedbush reiterated its Neutral rating on Riverbed Technology (NASDAQ: RVBD), but slightly lowered its price target from $21.00 to $20.00.
Wedbush noted, “We maintain our NEUTRAL rating given mixed results and guide which continue to point to a slowdown and the potential for integration risk near term. Despite in line EPS, Q4 revenue was below expectations with core Riverbed weaker than expected (but within guidance) and OPNET in line with our conservative estimates. Top line guidance was in line (but the core business appears to be displaying increasing seasonality), and EPS was below expectations as opex is likely to ramp higher than the combined company NT and material expense synergies are unlikely until 2014. In our view the key takeaway is that the business is likely to see anemic revenue growth until sales integration efforts begin to generate returns in 2H. We see risks to the story over the next 2-3 quarters from sales force integration activities, the potential for challenges in the government vertical and general integration activities which may cause disruptions in the business. We advise investors to remain on the sidelines and look to become more constructive on improving sales growth and visibility into the business.”
Riverbed Technology closed on Thursday at $20.10.
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