NetLogic: Caris Sees Rival Backing Off Primary Market

NetLogic Microsystems (NETL) shares have goten a lift this morning from a bullish note by Caris & Co. analyst Nicholas Aberle.

Aberle today raised his rating on the stock to Buy from Above Average. He contends that Integated Device Technologies (IDTI), the company’s chief rival in the market for a specialized memory chip known as TCAMs (apparently, that stands for ternary content addressable memory) plan to de-emphasize the parts. “We now believe NETL possesses material competitive advantage with respect to incremental TCAM design opportunities going forward,” he writes, reducing R&D on the parts to cut costs.

Aberle notes that the “vast majority” of TCAM shipments go to Cisco (CSCO), which uses the parts in switching and routing products. He says the threat of IDTI gaining traction outside of Cisco with “key customers” Juniper (JNPR), Alcatel-Lucent (ALU) and Huawei is now “largely mitigated,” and that NETL would gain share over time.

Aberle upped his target on the stock today to $30, from $25.

NETL today is up $1.43, or 5.8%, to $26.22.