UPDATE: BMO Capital Markets Lowers PT on Aruba Networks Following Weak Guidance
In a report published Friday, BMO Capital Markets analyst Tim Long reiterated a Market Perform rating on Aruba Networks (NASDAQ: ARUN), but lowered the price target from $17.00 to $15.00.
In the report, Long noted, “Results were in line with the negative preannouncement, but guidance was weak. We had been expecting a modest guide for the July quarter, but consensus assumed more of a bounce. Management mentioned a much more aggressive competitive stance from the largest competitor (Cisco), which is impacting the timing of deal closure, and has led to some deal loss. We still like the wireless LAN end market. However, we believe there is not much of a difference in the technology provided by Aruba, Cisco, and the other players. As such, Cisco bundling or cutting prices will likely lead to further share gains for them, and a tougher time for the smaller players.”
Aruba Networks closed on Thursday at $17.61.
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