Summit Research Expect Conservative Outlook for EMC Corporation Due to FX Headwinds

In a report published Monday, Summit Research analyst Srini Nandury reiterated a Buy rating and $31.00 price target on

. In the report, Summit Research noted, “EMC is scheduled to report F4Q14 earnings on Wednesday (01/28) before the market open. We forecast F4Q revenue of $7.1bln and EPS $0.68, in-line with consensus estimates. We expect the company to meet these estimates driven by improving storage demand, momentum in mid-range products, first full quarter of VMAX3, and emerging storage growth, offset by some legacy products and FX headwinds (Euro weakened by 8% during the quarter and EMC derives about 27% of revenue from EMEA). We expect EMC to issue conservative guidance (well understood by the Street and already factored into the stock) given the continued weakness in Euro, upcoming retirement of Mr. Tucci in February and the impending arrival of the new CEO. We are cautiously optimistic that 2015 will be a better year for storage spending as pointed by IDC/Gartner CIO surveys. We believe EMC is the best-positioned storage OEM in the industry. The company has been proactively assembling assets (organically as well as through acquisitions) to intercept the secular changes (Cloud, Flash, Software Defined Storage) that the storage industry is facing. Therefore, we reiterate our BUY rating on the stock and maintain our $31 PT.” EMC Corporation closed on Friday at $28.70.