Fusion-io (NYSE:FIO) was downgraded by research analysts at Monness Crespi & Hardt from a “buy” rating to a “neutral” rating in a report released on Thursday, Analyst Ratings.Net reports.
The analysts wrote, “Our rating change is based on: 1) Worse than expected revenue guidance for 1QFY14 (down 28% y/y versus +5% consensus) with both Facebook (FB/Not Rated) and Core revenue expected to decline q/q; 2) Risk of meeting required 2HFY14 revenue ramp – particularly from two large pending customers – to above 40% y/y in order to meet the company’s 20% FY14 revenue growth target; 3) More competitive pricing environment in both the Hyperscale and Enterprise environments are putting greater than expected pressure on Gross Margin – FY14 guidance of only 52-54% vs. 57.6% consensus and the company’s long-term target of 56-58%; and 4) Decreased operating leverage to offset the approximately $65 mln per quarter in operating expenses including a 16% increase in quota-carrying sales representatives and increased R&D to over $20 mln this quarter. Since we launched coverage earlier this year, we noted about a 6 to 9 month lead-time on Fusion-io’s technology. While we continue to believe FIO has industry-leading products and software, the competition is putting increased pressure on FIO’s fundamentals, therefore we are moving to a Neutral for the reasons listed above. However, we believe the reset in guidance, industry data points suggesting continued adoption of PCIe Flash solutions, a potential increase in Facebook capex spending over the next few quarters, and valuation keeps us from a Sell rating.”
Shares of Fusion-io (NYSE:FIO) opened at 14.90 on Thursday. Fusion-io has a 52 week low of $12.72 and a 52 week high of $32.63. The stock’s 50-day moving average is currently $14.35. The company’s market cap is $1.465 billion.
FIO has been the subject of a number of other recent research reports. Analysts at Benchmark Co. downgraded shares of Fusion-io from a “buy” rating to a “hold” rating in a research note to investors on Thursday. They now have a $13.00 price target on the stock. Separately, analysts at Mizuho downgraded shares of Fusion-io from a “buy” rating to a “neutral” rating in a research note to investors on Thursday. They now have a $13.00 price target on the stock, down previously from $22.00. Finally, analysts at RBC Capital cut their price target on shares of Fusion-io from $19.00 to $16.00 in a research note to investors on Monday, July 15th. They now have a “sector perform” rating on the stock.
One analyst has rated the stock with a sell rating, eighteen have assigned a hold rating and eight have given a buy rating to the company’s stock. The company has an average rating of “Hold” and an average price target of $20.73.
Fusion-io Inc (NYSE:FIO) is a provider of datacenter solutions that accelerate databases, virtualization, cloud computing, big data, and the applications that help drive business from the smallest e-tailers to some of the largest data centers, social media leaders, and Fortune Global 500 businesses.
