UPDATE: Bank of America Reiterates on Meru Networks as Stock Shows Some Improvement But Concerns Remain

In a report published Tuesday, Bank of America analyst Tal Liani reiterated an Underperform rating on

, and raised the price target from $2.75 to $3.25. In the report, Bank of America noted, “Q4 revenue exceeded estimates by 12%, driving break-even profitability vs Street expectations for EPS of ($0.06). However, Q1 guidance was $3mn below consensus and Meru will likely return to losses until about mid-2014. While the company is seeing solid initial uptake of its 802.11ac products, fierce competition, and the discretionary nature of WiFi investments and technology upgrades remain top of mind. We adjust our margin assumptions driving our FY14/15E EPS to ($0.18)/ $0.08 from ($0.10)/($0.01) and increase our PO to $3.25. Maintain Underperform.” Meru Networks closed on Monday at $4.39.