Piper Jaffray Sees Buying Opportunity for NetApp

Piper Jaffray has published a report on NetApp (NASDAQ: NTAP) after Xyratex (NASDAQ: XRTX) pre-announced negative third quarter earnings.In the report, Piper Jaffray wrote, "We view any selling pressure resulting from the Xyratex miss as a buying opportunity for shares of NTAP, ahead of a potentially strong FQ2 (Oct). While the Xyratex miss is alarming, we note that NetApp increased “purchased components” by 111% exiting FQ1 (July), likely in anticipation of the launch of the new FAS2220. Given the ramp in inventory in June/July, it is feasible that NetApp's purchases through Xyratex were likely lower than expected in August. Moreover, our preliminary checks with NetApp's Federalresellers suggest that quoting activity increased in August, and we remain optimistic that NetApp will capture a similar share of the annual budget flush as in years past."Piper Jaffray maintained its Overweight rating and $41 price target on NetApp, which is currently trading up 0.24 percent from Tuesday's $35.18 closing price.