An upgrade to Buy from ISI's Stephan Patel gives a lift to Brocade (BRCD +3.4%). Though Patel...

|About: Brocade Communications Syst... (BRCD)|By:, SA News Editor
An upgrade to Buy from ISI's Stephan Patel gives a lift to Brocade (BRCD +3.4%). Though Patel isn't crazy about Brocade's "fundamental growth prospects over the next several years" (he's worried about a lack of Fibre Channel hardware growth and an uphill battle against Cisco in Ethernet switching), he still sees "several potential near-term catalysts." These include a $0.03-$0.05 EPS boost from a $100M cost-cutting program, and "a more shareholder-friendly capital allocation program" that could include a ~$0.03/share quarterly dividend. Activist firm Elliott Management, known for pushing for such moves, has dumped its Brocade stake.