Canaccord Genuity analyst Paul Mansky this morning cut his rating on Compellent (CML) to Sell from Hold, while keeping his price target at $21.50, which is substantially below yesterday’s close at $26.06.
“September showed improvement after nine months of disappointment, but renewed competitive pressures on the horizon present incremental risks,” he writes in a research note. “At the same time, new customer revenue � the ultimate proxy for future growth � has remained largely flat; something we would not expect of a company disrupting the market. Investors with an M&A thesis may be proven correct in time, but investors backing into a fundamental justification should consider taking profits at these levels.”
Note that Reuters this week reported that the company has held meetings with investment banks about potentially seeking a buyer.
CML is down 92 cents, or 3.5%, to $25.14.
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