UPDATE: Axiom Capital Initiates Coverage on Shutterfly, Inc. with Buy Rating, $58 PT as Margins Expand

In a report published Wednesday, Axiom Capital analyst Victor Anthony initiated coverage on

with a Buy rating and $58.00 price target. In the report, Axiom Capital noted, "We are initiating coverage of Shutterfly with a Buy rating and $58 price target. Shutterfly has maintained a market-leading position in the intensely competitive market for social expression products through a combination of investments in product, brands, mobile, and capacity. We believe the company can continue to grow revenues at or above the growth rate of e-commerce in the U.S., and expand margins in late 2015 and 2016. Armed with a solid balance sheet, management could shrink the equity base by approximately 15% over the next three years. The presence of an activist investor, who could very well prevail, does complicate the investment case. However, we believe a chance exists to resolve the dispute prior to the shareholder vote." Shutterfly, Inc. closed on Tuesday at $47.50.