The Street's Bullish on Aruba Ahead of Earnings

| About: Aruba Networks, (ARUN)

Aruba Networks (NASDAQ:ARUN) shares were higher Monday after a flurry of bullish commentary from the Street ahead of the company’s expected announcement Tuesday of results for its fiscal fourth quarter ended July. In short, the Street is bullish on the company, which provides enterprise wireless networking gear (something we could use here at the Dow Jones outpost in Palo Alto, hint, hint.)

There seems to be growing conviction that the company will beat the Street consensus for the quarter, and also issue guidance for fiscal 2008 above current Street views.
  • W.R. Hambrecht’s Ryan Hutchinson launched coverage of the stock Monday with a Buy rating and a $25 price target. He says Aruba’s shares “are the best way for growth-oriented investors to gain exposure to the fast-growing enterprise WLAN market.”
  • Stifel Nicolaus’ Sanjiv Wadhwani wrote Monday that his checks find the company should “comfortably exceed” his Q4 estimates of $39.4 million in revenue and EPS of one cent. He says demand for wireless LAN gear “remains robust,” with Aruba “a strong player.” He thinks FY 2008 guidance will be above the current consensus of $206 million and 20 cents.
  • RBC Capital’s Mark Sue Monday upped his target on the stock to $19 from $18, and said the company should beat the consensus for the quarter of $40 million and come in closer to $41.5 million. He sees FY 2008 guidance coming in at $210 million to $215 million. However, he maintains a Sector Perform rating on the stock, noting that valuation is “still way-up there.”
  • ThinkEquity’s Anton Wahlman Monday morning boosted his price target on the stock to $20 from $18. He says a big catalyst for the stock could be the launch of the Research in Motion (RIMM) Blackberry 8320 with T-Mobile next month. The 8320 is supposed to include Wi-Fi capability. Wahlman says that the launch will “cause a scramble by CFOs all over the country - and soon across the world - to deploy the kinds of WiFi enterprise networks developed by Aruba.” The idea is that you will be able to make voice over IP calls via your cell phone; he thinks that the 8320 launch will be “the watershed event which will cause CFOs to view WiFi networks as cost-saving imperatives, as opposed to luxury overhead for geeks.”