UPDATE: FBN Securities Raises PT on NetApp on Capital Allocation Program

In a report published on Wednesday, FBN Securities analyst Shebly Seyrafi raised the price target on

from $40.00 to $42.00, and reiterated an Outperform rating. In the report, FBN Securities noted, "FQ4 results - Strong product GM, but weakness in US Public. For the FQ4/Apr. quarter, NTAP reported revenue of $1.72B (up 1% Y/Y and lower than consensus of $1.76B) and NG EPS of $.69 (higher than consensus of $.68). The revenue miss was roughly half in products and half in software and services. We are impressed by the 55.8% product GM (up 2.7pp Q/Q and higher than our 53.0% estimate), but we are disappointed with the deceleration in branded revenue growth to only 3% from 9% in FQ3 (OEM declined by 17% in FQ4, the same as in FQ3). By customer segment, we like the acceleration in US Commercial revenue (43% rev.0 to 4% Y/Y growth from 1% in FQ3, but we are disappointed by the 10% Y/Y decline in US Public (13% rev.) following the strong 14% Y/Y growth in FQ3. EMEA (30% rev.) decelerated to flat growth from 1% in FQ3 and Asia (13% rev.) decelerated to only 5% grwoth from double-digit growth the prior two quarters." NetApp is currently trading at $37.79.