UPDATE: Sterne Agee Upgrades Silicon Graphics International to Buy on Execution, Growth Outlook

Sterne Agee upgraded Silicon Graphics International (NASDAQ: SGI) from Neutral to Buy and announced a $19.00 price target.Sterne Agee said, "We continue to see SGI as well positioned for growth in Big Data among historical High Performance Computer customers with a wide array of In-Memory and Hadoop solutions. Yet the focus of our upgrade is catalysts we believe will drive incremental leverage in the model over the coming year. While we continue to stress potential near-term "choppiness" due to timing of large deals and/or how the Amazon relationship plays out, etc., we believe SGI can hit its medium-term OM target of ~7% by 3Q14 vs. consensus at 4% and our prior estimate of 5.8%. Most important, with SGI pre-announcing last week a $15M shortfall due to 3 U.S. Federal deals (2 that have already closed, vertical is 20% of revenue), we believe the risk factor is largely out of the stock."Silicon Graphics International closed at $11.98 on Thursday.