ThinkEquity Rates Brocade Communications Systems (BRCD) A Buy

ThinkEquity LLC analyst Rajesh Ghai reiterated a Buy rating for shares of Brocade Communications Systems, Inc. (Nasdaq: BRCD).

Ghai said after a visit to the headquarters of Brocade Communications Systems that the recovery at the company remains a work in progress but the steps being taken by management are encouraging.

After Brocade Communications Systems lowered its guidance, the analyst thought that the investor expectations were now at a manageable level.

The ThinkEquity LLC analyst wrote, "we believe there is low risk of further significant declines in the LAN business. Given the company's efforts to stabilize the LAN business, as outlined earlier in this note, we believe BRCD is unlikely to see further decline in the LAN business. We believe there is a strong likelihood that the Federal business shortfall witnessed in 1Q will be overcome later in FY10. Also, the early signs of LAN pickup at Dell are very encouraging to us, even though LAN pickup at IBM continues to be a 'distant dream' at this point of time, in our opinion."