BUY EXTR

Extreme Networks Inc. (NASDAQ–EXTR)
Valuation-$6.81
Price March 22, 2010-$3.04

EXTR is a network product and service company.

As of December 27, 2009, EXTR had $135 million in net cash and investments and was slightly unprofitable (about $1.4 million loss in latest quarter on a GAAP basis). Our valuation is $6.81 per share so it is trading at 45% of our valuation. Cash is $1.52 per share or 50% of the market price.
Revenues are about $300 million a year, with 58% gross margins.

Ramius LLC filed a 13D on March 15th disclosing over 5% ownership. Ramius usually stirs things up a bit (like the share price). Good valuation, lots of cash, not losing much money and a catalyst in Ramius. Seems like a cheap stock to us.

EXTR trades over 500,000 shares a day.

There are about 90 million fully diluted shares outstanding.

Extreme Networks, Inc.
Extreme Networks provides converged Ethernet network infrastructure that support data, voice and video for enterprises and service providers. The company’s network solutions feature high performance, high availability and scalable switching solutions that enable organizations to address real-world communications challenges and opportunities. Â Operating in more than 50 countries, Extreme Networks provides wired and wireless secure LANs, data center infrastructure and Service Provider Ethernet transport solutions that are complemented by global, 24×7 service and support.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s