First Albany upgrades web security appliance company Blue Coat Systems (BCSI).
Analyst Scott Zeller says he is upgrading Blue Coat Systems to buy from neutral with a $30 price target.
He bases his upgrade on several risk factors being mitigated in the past several weeks, solid fourth-quarter results, strong forward guidance, and continued positive field checks on Blue Coat Systems products.
Zeller notes several cautionary points on Blue Coat Systems have been addressed, including Sarbanes-Oxley, costs of lawsuits, and third-party revenues. He says, while risk remains (SEC), he believes there has been substantial improvement in the risk/reward profile at Blue Coat Systems.
He raises his 70 cents fiscal 2006 (ending April) earnings per share estimate to $1.03, and sees $1.60 fiscal 2007 earnings per share.