Emulex Up 6% On Bullish Chase H&Q Note
Dow Jones Newswires
NEW YORK -- Shares of Emulex Corp. (EMLX) gained Thursday after two days of losses caused, in part, by a Morgan Keegan & Co. analyst's downgrade.
Robert Montague cut his rating on the supplier of network-access products Tuesday, citing his belief that growth in the fibre channel data storage sector would be driven by the Windows NT market rather than the UNIX market where Emulex derives a substantial amount of revenue.
However, on Thursday, Chase H&Q analyst William A. Lewis initiated coverage of Emulex with a buy rating, saying he felt UNIX, and not Windows, would drive sector growth.
In his report, Lewis said Emulex is the market share leader in "Fibre Channel HBAs" for networks targeting both UNIX and Windows.
Because Emulex has dropped "45% from its recent highs," Lewis thinks it is a buying opportunity, and expects the company to exceed Chase's third-quarter 2000 earnings forecast of 19 cents a share. He put a $200 price target on the stock, but did not specify a time frame.
Shares of the Costa Mesa, Calif., company trade at a premium to the company's peer group, the note says, and Emulex maintains approximately 40% of the "Fibre Channel HBA" market.
Recently, Emulex traded at 128 1/2, up 6 13/16, or 6% on volume of 4.5 million compared with average daily volume of 1.4 million.
Shares reached an intraday high of 140, down from its 52-week high of 225 1/2 reached Monday. Shares closed that day at 218. After the Morgan Keegan report Tuesday, shares closed at 160 15/16, and at 121 11/16 on Wednesday.
Emulex, Costa Mesa, Calif., officials were not immediately available for comment.
-K. Maxwell Murphy; Dow Jones Newswires; 201-938-5173
This article from the wsj.com filled in some blanks. No time frame for a stock. Must be kidding me.
Jack |
