Avian Securities has an interesting call out on Compellent (NYSE:CML) after they had a chance to speak with management team recently. The meeting as well as recent conversations with contacts have highlighted the following points:
1) Compellent continues to execute in its core market segment (commercial to SME). In Avian's view, Compellent’s emergence at a time when opportunities in this market are accelerating, provides a strong growth path through CY’08.
2) An opportunity is emerging in larger enterprise accounts and it appears CML is taking steps to engage this market; and
3) It appears CML is also looking at moving downstream, an initiative that they see as more problematic given the potential for channel conflict as well as service issues.
In firm's view, strong company visibility through Q1 as well as conservative Q4 guidance mitigate near-term risk. Moreover, b/c spending in Compellent’s current customer base has historically proven more resilient in economic downturns, they see the company as better positioned than some of its competitor’s heading into a period of macro uncertainty. Finally, checks continue to suggest growth in deal size, with traction in larger enterprise accounts offering a growth path beyond 2008. As such we view Compellent as an attractive longer-term opportunity that is somewhat insulated from the perceived near-term risks in the storage segment.
Notablecalls: Darn, I had this call from Avian pre-open and I forgot to post it. And now it's up almost 8%. The stock looks cheap and bottomed out. Worth a look.
I think Avian is starting to get noticed as their calls work out. Anything from Tero Kuittinen, their wireless analyst is a MUST read.