From Yahoo message board, RBC analyst note. Two interesting
things from this note are the internal vrs. street targets
and also the stock's history of summer buying opportunities.
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messages.finance.yahoo.com
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Subject: NTAP - collect our thoughts
So much being thrown around on this name the past 2 weeks since our upgrade. Time to straighten stuff out and take advantage of the confusion.
Same thing has happened past 3 years, stock gets hit on q1 guidance, bounces around as everyone says how weak the qtr is tracking and then they come out and put decent enough #'s up.
More people are going to be out talking about how NTAP is behind plan. We agree that NTAP is behind plan, but they never lowered the internal plan!!!
* Internal Plan - $800 million in booking for the July qtr and 32% growth yoy
* Street Cons - $760mm in booking for the July qtr and 25% growth yoy
Our checks so far, May was bad, June picked up and they've got more momentum heading into July, the bet continues to be they'll be able to hit and guide to street #'s.
Our Upgrade was based on the fact that; They never cut internal plan, backlog is fine, internally they see the market as good, field checks show no competition hurting them (all enterprise slow down in q1), and lastly valuation at bottom end range levels (18x '08ev/fcf) - This still holds.
Leave you with one more thing, here are the winter highs to summer lows for the stock past 3 years:
11/15/03 - $24.87
8/14/04 - $15.92
Corrected 36%
12/25/04 - $34.97
8/13/05 - $22.61
Corrected 35%
4/22/06 - $38.50
7/22/06 - $25.85
Corrected 33%
12/23/06 - $41.56
Today - $29.19
Corrected 30%......
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