UPDATE: Morgan Stanley Initiates Coverage On F5 Networks

In a note released Wednesday morning Morgan Stanley analyst James Faucette initiated coverage on F5 Networks FFIV with an Equal-weight rating, but did not set a price target. Faucette wrote, "We agree with the Street estimates of 300-800 bps of revenue growth above industry rates for the next 2-3 years, and believe F5 could achieve above market growth rates into perpetuity with continued innovation." To spur this innovation and expansion into ancillary markets, Faucette noted, the company will need to continue to invest in R&D and S&M. Furthermore, he believes expansion is needed to justify the assumed growth rate. Looking forward, Faucette anticipates another year of above-market growth due to market share gains as Cisco Systems exits the ADC market.