Longbow Research Remains on the Sidelines with NetApp

In a report published Thursday, Longbow Research analyst Joe Wittine reiterated a Neutral rating on NetApp NTAP. In the report, Longbow Research noted, “We continue to rate the shares of NTAP NEUTRAL. The recent multiple compression has left the shares inexpensive, and NTAP's aggressive share buyback likely limits further downside ($1.1B will reduce share count by another ~8% net). However, we remain on the sidelines awaiting evidence that sales can return to growth in 2H CY14; particularly since (1) our channel discussions highlight NTAP's competitive challenges, (2) the challenged U.S. Public Sector and OEM businesses still represent 20% of sales, and (3) NTAP has seemingly set a high FY15 bar by forecasting mid-single-digit Branded sales growth.” NetApp closed on Wednesday at $34.49.