UPDATE: Goldman Sachs Initiates Neutral, $16 PT on Finisar: Growth Sustainability Questioned

Goldman Sachs initiated its coverage on Finisar

with a Neutral rating and a price target of $16 a share. Goldman Sachs commented, "We see Finisar as well-positioned to capitalize on the current inventory upcycle due to its significant operating leverage and an improving product mix. However, looking beyond the near term, we are cautious on the sustainability of Finisar's revenue growth as certain obstacles remain on the horizon. We estimate bottom-line will outpace top-line growth as Finisar grows revenue and EPS at 7% and 19% CAGRs through 2015E." Finisar closed at $14.37 on Thursday.