UPDATE: BMO Initiates Coverage On Ruckus Wireless, Optimistic On Company's Growth In Coverage Universe

In a report published Tuesday, BMO Capital Markets analyst Tim Long initiated coverage on

with an Outperform rating and $13.00 price target. BMO sees Ruckus as one of the best growth companies among the firm's coverage universe as the Wireless LAN segment has solid growth in both Enterprise and Service Provider. The analyst reported that the company has been taking shares in both areas, but believes the Service Provider segment will be a “more meaningful contributor” in the long run given higher growth with less competitors. Long wrote, “We believe offload will remain strong, indoor coverage will become more critical, cable MSOs will build aggressively, and the ALU and NOK partnerships will drive business. For enterprise, BYOD remains the key driver, the transition to 802.11ac Waves 1 and 2 provides a steady upgrade path, and expansion into new verticals should help growth.” The analyst established EPS estimates for 2014 and 2015 of $0.22 and $0.36, respectively. BMO forecasts Enterprise growth of 11 percent and Service provider growth of 17 percent through 2018. Shares of Ruckus Wireless closed Tuesday at $10.37; the stock is currently trading at $10.57, up 1.93 percent.