Needham Says Fears Related to Fusion-io Seem to Be Clearing Up, Initiates with Buy Rating, $20 Target

Needham's Richard Kugele initiated coverage on Fusion-io

with a Buy rating and a $20 price target Tuesday morning. After sales lumpiness from its top two customers, estimate cuts, and the sudden departure of its co-founders, the uncertainty surrounding Fusion-IO

appears to be dissipating, according to Kugele. The Needham analyst said FIO's negative sentiment and estimate revisions may have “finally troughed." Kugele cited FIO's “pole position” in the industry and new product rollouts slated for later this year as drivers for the strong rating. With Fusion-io shares down 0.3 percent to $13.25 at last check, Kugele's price target represents potential upside of about 51 percent.