Wedbush: F5 Networks Will Have 'Another Run At $140'

In a report rolled out Tuesday, Wedbush analyst Scott Thompson initiated coverage on shares of F5 Networks, Inc. FFIV with an Outperform rating. According to Thompson, "software-defined services position [the] stock from another run at $140."

Wedbush declares being "cautiously optimistic" about the company's ability to continue to deliver double-digit top-and bottom-line growth in 2015. The report outlines three main reasons for this:

1. Over the past year, F5 has proven the "capability to deftly manage the shift from hardware- to more software-based services."
2. The company's revenue stream is becoming increasingly diversified.
3. The research firm believes the stock is "conservatively valued, leaving room for multiple expansion."

The report warns, "while there is risk to the company's effort to transition products to a more ‘virtual' offering, F5's value proposition as a relatively more software-based and application-focused solution should enable the company to thrive in a sector where companies with a core competency in software are increasingly more likely to outperform their peers."

Analysts at Wedbush are modeling EPS of $6.47 for 2015 (above consensus of $6.35), and EPS of $8.01 for 2016 – versus $7.23.