Jefferies Lowers Price Target on Emulex Corp.

Jefferies analysts Munjal Shah, William Choi, and Rahul Khanwalkar maintained their Buy rating on Emulex Inc. (NYSE: ELX), but lowered their price target from $16 to $12.

Yesterday, Emulex announced it would acquire its strategic partner ServerEngines for $184 million. This acquisition was somewhat expected, since Emulex was ServerEngine's primary customer of 10GbE chips.

According to the analysts, "Emulex is gearing up for a potential ramp in 10GB CNAs. We like the L-T trends with respect to server refresh, 8GB adoption and transition to converged networks. We expect ramp will likely occur in 2H 2010."

Emulex is currently trading at $9.65.