RadiSys Corporation (RSYS)

[Mitshu35]

Needham Upgrade from 7/27/16:

Needham & Company reiterated a Buy rating on Radisys Corp (NASDAQ: RSYS), and raised the price target to $6.00 (from $5.50), following the company's 2Q earnings report. RSYS reported revenue of $61.3MM, ahead of $60.4MM estimates, driven by Embedded Products. NG EPS of $0.10 also exceeded estimates of $0.07.

Analyst Richard Valera commented, "RSYS delivered solid 2Q16 results and largely maintained its prior 2016 guidance. We think the company is positioned to continue to deliver growth in its high-margin SS business, with its nascent FlowEngine product standing out as the most significant growth driver in that business. As well, its new DCEngine product has opened up a major new revenue opportunity for the company and appears to have a strong pipeline of opportunities beyond its initial large orders from Verizon. In aggregate, we see the FlowEngine and DCEngine opportunities as large relative to the size and market cap of RSYS. We maintain our Buy while nudging up our PT to $6 (was $5.50), or 1.0x EV/C'18 revenue."

Shares of RadiSys closed at $5.17 yesterday.