The price target still represents a downside from the stock's closing price Friday of $45.43.
The firm is bullish on the company because it says that the negative news that has seen the stock drop about 20% in August already has been priced into the stock.
"NTAP is in year 3 of an evolutionary turnaround, and its investments in Cloud-based data management solutions and flash media-based storage are beginning to build momentum. In the intermediate term, however, we expect NTAP to continue to struggle against both market incumbents and nascent storage players for product share gain as hybrid cloud spending remains in a lull," analyst Karl Ackerman said.
Despite those near-term headwinds, Ackerman still believes NetApp is one of the best plays in the sector.
"Longer term, we still recognize that NTAP's leadership in hybrid cloud purpose-built storage systems and data management software should enable the company to generate low-single digit revenue growth and high-single digit EPS growth through 2020. We also continue to view NTAP's industry-leading profitability and capital return to shareholders as unique among broader IT hardware and storage," Ackerman said.
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