UPDATE: Credit Suisse Initiates Coverage on Ubiquiti Networks on Full Valuation

In a report published Thursday, Credit Suisse analyst Kulbinder Garcha initiated coverage on

with a Neutral rating and $33.00 price target. In the report, Credit Suisse noted, “We believe that Ubiquiti has created a relatively unique business model that can disrupt several markets in the networking space over time. However, we believe shares are fully valued, with strong near-term revenue momentum offset by medium-term competitive risks and possible margin pressure. In the near term, we see possible upside to our revenue projections of $501mn for FY14 and $610mn for FY15, which are above consensus expectations. First, airMAX (65% of revenues) could see a continued rebound, given pent-up demand and the large opportunity in the WISP market. Second, UniFi is gaining traction in the WLAN segment. While the company's ambition to be number one in unit terms may appear lofty, achieving this could add a further $180mn in revenues, or 30% to our estimates for FY15.” Ubiquiti Networks closed on Wednesday at $33.18.