Jefferies Initiates Coverage of NetApp

In a note dated October 9, Jefferies ananlyst, James Kisner initiated coverage of NetApp, Inc.

with a Hold rating and a $45 price target. Kisner commented, "NetApp is not as well-positioned to address longer term cloud trends and is the most at risk to lose share to new entrants in the storage market." Having said that, Kisner noted investor appear to be largely aware of the downside and competitive risks. He also noted the company should benefit from a positive medium-term backdrop in storage as well as the recent refresh of its product line. Additionally, Kisner believes NetApp's strong cash position and the frequent speculation of the company as a take over target will mitigate some of the downside risk. However, he does not feel a takeover is likely. At last check, shares of NetApp were trading about one percent lower in the earlier hours of Friday's market session.