Susquehanna analysts raised NetApp (NASDAQ:NTAP) to Positive from Neutral, lifting the price target to $100 per share from $62 in a note to clients Tuesday.
The analysts told investors in a research note that the company's product revenue is bottoming, while SAN-specific AFA's are driving growth.
"Quarterly Product revenue has bottomed (-25% Y/Y in July, -34% from the peak of Apr-22) and is poised to show Q/Q improvement with Y/Y growth resumption by mid-CY24 driven by increased demand for SAN-specific AFAs and share gains in the $18B SAN market," the analysts wrote.
They expanded: "Looking forward, the recovery in Product Rev is expected to gain momentum in 2024 as 'trained' models that are currently in the public cloud migrate to on-prem/Edge for 'inferencing' due to increased security/compliance/IP requirements. This is expected to drive 'incremental' demand for SAN-specific 'Object' Storage."
On the back of the Susquehanna re-rating, NetApp shares have jumped 2.5% during Tuesday's session, hitting levels last seen in early August. The stock is currently up 32% in 2023.