UPDATE: D.A. Davidson Initiates Coverage On QLogic As Ethernet Leads Way To Growth

In a report published Tuesday, D.A. Davidson analyst Mark Kelleher initiated coverage on

with a Buy rating and $17.00 price target. In the report, D.A. Davidson noted, “We believe QLGC is well-positioned to return to sustainable growth driven by new Ethernet connectivity products, with new storage architectures allowing Fibre Channel connectivity to grow as well. Based on our assumption of a 10% growth rate, a P/E/G ratio of 1.2 (a P/E multiple of 12x) and our calendar 2016 EPS estimate of $1.14, and adding $3.14 per share in cash, we calculate a 12-18 month price target for QLGC of $17. We are initiating coverage of QLogic Corporation with a BUY rating.” QLogic closed on Monday at $12.68.