Equity Insights June 5th: Limelight Networks, Shire, Whiting Petroleum, Parametric Technology, Lithia
Limelight Networks, Inc. (NASDAQ:LLNW): Jefferies notes that Netflix announced it has been actively building its own single-purpose content delivery network, or CDN, with plans to eventually deliver a majority of its traffic through the network. Jefferies believes the move is an attempt to reduce Netflix’s reliance on commercial CDNs, which it feels will lead to near-term weakness in shares of vendors including Akamai (NASDAQ:AKAM), Limelight Networks (NASDAQ:LLNW) and Level 3 (NASDAQ:LVLT). The firm expects Limelight to be the focus of the weakness as Netflix accounted for 11% of the company’s revenue in 2011.
Shire plc (NASDAQ:SHPGY): Cowen said the valuation of Shire makes very little sense and they would be buyers of the shares right here. The firm cited the company’s recent weakness but believes it could announce settlements with competitors regarding generics of both Adderall XR and Intuniv drugs. Shares remain Outperform rated.
Whiting Petroleum Corp. (NYSE:WLL): Brean Murray lowered its price target on Whiting Petroleum citing a lowered price outlook for crude oil. The firm remains bullish on the shares given several catalysts that include production growth from its Pronghorn field and a de-risking of the company’s Permian Basin properties. Shares remain Buy rated.
Parametric Technology Corporation (NASDAQ:PMTC): ThinkEquity believes that Parametric’s margin is poised to increase significantly over the next several years, reaching at least 25% by FY15. The firm believes that the company’s revenue can increase at least 10% annually and it maintains a Buy rating.
Lithia Motors Inc. (NYSE:LAD): Credit Suisse said Lithia is well positioned given its solid top-line growth, expense discipline, and gross margin profile. Shares are Outperform rated with a $30 price target.
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