11.08.07 

rvbd: MEETING WITH MANAGEMENT SUGGESTS FUNDAMENTALS INTACT
We reiterate our Buy rating following a recent investor meeting with management. Both CEO Jerry Kennelly and CFO Randy Gottfried maintain that the fundamentals are as strong as ever, that the competitive landscape is relatively unchanged, and that they intend to aggressively pursue growth. In hindsight, we think that the company may have under invested in the first half of the year, and as a result, we believe that the Street (ourselves included) became overly optimistic regarding the company's projected operating margin expansion. Overall, we believe that the growth story is intact and we understand the critical need for the company to opportunistically make investments in order to secure market share. The recent pullback creates an opportunity to own the best growth story in the sector, in our view. Contact Us for Full Report - PDF

10.24.07 

rvbd: RECORD QUARTER NOT ENOUGH TO SATISFY EXPECTATIONS; BELIEVE FUNDAMENTALLY, NOTHING HAS CHANGED
Riverbed reported Q3:07 results with revenue ahead, while EPS was just in line. Guidance calls for revenue ahead, but EPS only in line with current consensus. While we believe that our overall investment thesis holds, we believe investors were 'looking for more'. We expect RVBD shares will be under pressure this morning and find support in the mid- to low-30s. Fundamentally, nothing has changed, in our view. We believe Riverbed has 1) defined the WDS market; 2) will continue to post explosive revenue growth, far outpacing its closest competitors; and 3) will maintain its leadership position in this nascent multi-billion dollar market. We are raising our top line estimates for Q4 and 2008, but are adjusting our EPS estimates downward to reflect increased investments. We maintain our Buy rating and revised $46 price target, reflecting 40x our fully taxed 2009 operating income assumption, plus cash. Contact Us for Full Report - PDF

09.06.07 

rvbd: PULLBACK CREATES BUYING OPPORTUNITY; REITERATING BUY RATING
RVBD shares have sold off ~15% during the last two trading sessions. We believe the shares have been under pressure due to comments from competitors suggesting that 1) the financial services vertical is causing more uncertainty than expected, 2) that M&A is imminent given the company's recent hire of a head of M&A, 3) and that the market is becoming more competitive as other players close the technological gap. We believe that essentially nothing has changed and that the fundamentals remain intact. We believe that the unwarranted pullback creates an opportunity and would be buyers at these levels. Contact Us for Full Report - PDF

07.27.07 

rvbd: A RIVER MONSTER; REITERATING BUY RATING
Riverbed's Q2 report marks another milestone, with record revenue of $54M above our Street-high estimate of $53M and consensus of $49.8M. EPS of $0.16 was also better than expected and above our estimate of $0.14 and the Street's $0.13. Overall, we believe the better than expected guidance of $59-61M in revenue and $0.15-0.17 EPS compared to consensus of $55M and $0.13 offers further evidence that demand remains robust, the pipeline is healthy, and Riverbed is the clear leader in the WDS market. Looking forward, we expect the Company will continue to make steady investments to drive top line growth while maintaining healthy gross margins and demonstrating operating leverage. We believe that Riverbed is one of the best names in our coverage universe and would be buyers at current levels. Although expensive, we'd be willing to pay 45x our 2009 EPS estimate of $1.25 for RVBD shares. We are therefore reiterating our Buy rating and raising our price target to $56/share. Contact Us for Full Report - PDF

06.21.07 

rvbd: JUNE QUARTER EARNINGS PREVIEW; LOOKING FOR ANOTHER PRIZE CATCH
Riverbed will close its June quarter later next week. Based on our checks, we believe that Riverbed will report results above consensus estimates. We continue to believe Riverbed is the thought leader in the flourishing WDS market and will continue to extend its market leadership position at a rapid pace. Based on our checks, we are taking numbers up slightly and increasing our price target to $47/share based on 50x our fully-taxed revised 2008 operating income assumption of $0.88/share, plus $2.74/share in cash. We are reiterating our Buy rating on RVBD shares. Contact Us for Full Report - PDF

05.14.07 

rvbd: THE FISH CONTINUE TO BITE; Q2 TRACKING AHEAD OF PLAN; INCREASING ESTIMATES AND PRICE TARGET
We are reiterating our Buy rating on Riverbed Technology as it remains one of our top picks. We have recently completed a series of channel checks, which suggest to us that Q2 is tracking ahead of plan and that the Company has been capturing incrementally larger deals. Moreover, we believe that there is significant pent-up demand for the forthcoming software-based laptop client. We continue to believe that Riverbed is the thought leader in the flourishing WDS market and it will likely continue to extend its market and technology leadership position. We expect the Company to continue to drive impressive revenue growth, improve margins, outpace its closest competitors, and grow its share of this $14 billion market. With the lock-up behind us, we would be buyers of the stock at current levels. We are reiterating our Buy rating and increasing our price target to $42/share, from $38/share, based on 45x our fully-taxed revised 2008 operating income assumption of $0.87/share plus $2.74/share in cash. Contact Us for Full Report - PDF

04.25.07 

rvbd: NOT THROWING THIS ONE BACK; REITERATING BUY RATING
Riverbed beat our Street-high Q1 estimates and offered Q2 and 2007 guidance well above Street estimates. We continue to believe Riverbed is the thought leader in WDS and will continue to maintain its market and technology leadership position. We expect the Company to continue to drive impressive revenue growth, improve margins, outpace its closest competitors, and grow its share of this multi-billion dollar market. Although expensive, we'd be willing to pay 45x our fully-taxed 2008 EPS estimate of $0.84 for RVBD shares. We are therefore reiterating our Buy rating and raising our price target to $38/share (from $35/share). Contact Us for Full Report - PDF

03.27.07 

rvbd: MARCH QUARTER EARNINGS PREVIEW; CHECKS POINT TO ANOTHER RECORD QUARTER
Riverbed will close its March quarter later this week. Based on our checks, we believe the Company will report results ahead of our and consensus estimates. We continue to believe Riverbed is the thought leader in WDS and will continue to maintain its market and technology leadership position, post explosive revenue growth far outpacing its closest competitors, and grow its share of this multi-billion dollar market. With the initial lock up behind us and with RVBD shares off over 20% from their recent highs, we would be buyers at current levels. We are reiterating our Buy rating and $35/share price target, based on 40x our fully-taxed 2008 EPS estimate of $0.83. Contact Us for Full Report - PDF

02.23.07 

rvbd: OUTFITTING ITS TACKLE BOX; COMPLETES SECONDARY OFFERING; REITERATING BUY RATING
Yesterday after the close, Riverbed completed its secondary offering and raised ~$80M. We believe this successful transaction endorses our bullish stance on the name and we anticipate that this infusion of capital should allow the Company to make strategic acquisitions and further distance itself from the competition. With the Company continuing to exceed expectations since its IPO last September by making impressive customer additions and winning large-sized Steelhead projects with 'powerful tails', we continue to favor the long-term growth prospects for Riverbed and believe we will continue to witness upside to current consensus estimates. We are reiterating our Buy rating and $35/share price target, which reflects ~40x our Street-high 2008 EPS estimate of $0.83. Contact Us for Full Report - PDF

02.08.07 

rvbd: ANOTHER 'BEAT AND RAISE'; ANNOUNCES SECONDARY OFFERING; SLIGHTLY LOWERING EPS TO REFLECT HIGHER SHARE COUNT AND OUR OVERLY AGGRESSIVE GROSS MARGIN ASSUMPTIONS; REITERATING BUY RATING
Yesterday after the market close, Riverbed Technology reported Q4:06 earnings results with revenue and EPS coming in ahead of our and consensus estimates. Overall, we believe the Company has continued to exceed expectations since its IPO last September and consistently raises the bar for itself as the leader in the hotly-contested WDS market. Additionally, during the quarter, we believe the Company lived up to our expectations for impressive customer additions and large-sized Steelhead projects with 'powerful tails'. However, while we continue to favor the long-term growth prospects for Riverbed and believe the top and bottom line will continue to expand, we are slightly lowering our EPS estimates to reflect a higher share count and our overly aggressive gross margin assumptions. Based on these new estimates, we are reiterating our Buy rating and lowering our price target to $35/share from $40/share which reflects ~40x our revised 2008 EPS estimate of $0.86. Contact Us for Full Report - PDF

02.07.07 

rvbd: DECEMBER QUARTER EARNINGS PREVIEW; STILL ROARING
Riverbed Technology is expected to report its December quarterly earnings tonight after the market close. Based on our channel checks, we believe Riverbed will report revenue and EPS ahead of consensus estimates. Overall, we believe the Company has continually stayed one step ahead of the competition since its IPO last September, driven by impressive customer additions and large-sized Steelhead projects with 'powerful tails'. Further, we believe the Company is poised to capitalize on a compelling product roadmap and to continue outpacing its competitors' growth throughout 2007. Given our expectations for strong December results and our view of the Company as the dominant player in the Wide-Area Data Services market, we are reiterating our Buy rating on RVBD shares and $40/share price target, based on 40x our fully-taxed 2008 EPS estimate of $1.00. Contact Us for Full Report - PDF

12.19.06 

rvbd: BEHIND EVERY STEELHEAD IS ONE POWERFUL TAIL; INCREASING ESTIMATES AND PRICE TARGET
Since its IPO in September, we believe that Riverbed has continually stayed one step ahead of the competition while creating considerable shareholder value. Based on our recent channel checks, we believe the Company is currently tracking ahead of plan for the December quarter. We feel that strength has been driven by impressive customer additions, large-sized Steelhead projects with 'one powerful tail', and a compelling product roadmap-all of which we believe poise the Company to continue growth and market share gains well into 2007 and beyond. We believe a strong December quarterly performance will underscore Riverbed's dominant market position within the Wide-Area Data Services market and represent yet another step towards achieving earnings power of $1 per share in 2008. We are reiterating our Buy rating on RVBD shares and increasing our price target to $40/share (from $25/share) based on 40x our fully-taxed revised 2008 EPS estimate of $1.00. Contact Us for Full Report - PDF

10.27.06 

rvbd: ROARS OUT OF THE GATE; REITERATING BUY RATING
Yesterday after the market close, Riverbed Technology reported Q3:06 earnings results-its first as a publicly traded company. Since going public in late September, the Company has performed solidly and, as expected, announced strong results exceeding both our and consensus estimates. Overall, we believe the Company has outperformed relative to expectations and this quarter's results reinforce the notion that Riverbed possesses a compelling technology within a huge addressable market, thus making RVBD shares the best way for growth-oriented investors to gain exposure to the fast growing WDS market, in our view. We are reiterating our Buy rating and raising our price target to $25/share which reflects 35-45x our fully-taxed 2008 operational EPS estimate, plus $1.64 in cash/share and takes into account our view that the Company will grab a meaningful share of a market expected to be in the billions over the next few years, which should provide it with numerous opportunities to show upside to our published estimates. Contact Us for Full Report - PDF

09.21.06 

rvbd: PRICES IPO ABOVE THE RANGE; BEST WAY TO PLAY FAST GROWING WIDE-AREA DATA SERVICES MARKET
Over the last two weeks, Riverbed Technology conducted a roadshow in preparation for its IPO. Last night, the Company successfully priced its IPO above the expected range of $7.00-8.50 per share, raising $85.8M on 8.8M shares, higher than the planned 8.4M share count. We view the $9.75 price per share as an indication of strong investor interest in the issue, which we believe will continue weeks and perhaps months following the IPO. Overall, we believe the Company possesses a compelling technology within a huge addressable market which makes RVBD shares the best way for growth oriented investors to gain exposure to the fast growing WDS market. Our price target of $11 is based on 5x EV to our 2007 estimate of $120.1M in revenue. Contact Us for Full Report - PDF

09.11.06 

rvbd: THE THOUGHT LEADER; INITIATING COVERAGE WITH A BUY
We are initiating coverage of Riverbed Technology (RVBD), a leading provider of Wide-Area Data Services (WDS) solutions, with a Buy rating and 12-month price target of $11. Riverbed management is currently conducting a roadshow in preparation for the Company's initial public offering, which we believe will take place later this month. We view Riverbed as the innovation and thought leader in WDS-a subset of the application delivery infrastructure market geared specifically towards addressing Wide-Area Network (WAN) performance. By offering one of the most comprehensive solutions available, we believe that Riverbed has defined the market for WDS and should continue maintaining its market and technology leadership position, post explosive revenue growth far outpacing its closest competitors, and grow its share of the market. We believe the Company possesses a compelling technology within a huge addressable market which makes RVBD shares the best way for growth oriented investors to gain exposure to the fast-growing WDS market, in our view. We highlight the following key points supporting our Buy rating and $11 price target: Contact Us for Full Report - PDF