Analysts bullish on Cisco data center rival Brocade

The reports are starting to come in from analysts who attended Brocade’s annual Analyst Day this week. And those reports indicate growing momentum for the storage networking company and a competitior gaining increasing strength to battle Cisco in the data center.

Highlights of the conference were Brocade’s guidance for the rest of the 09 fiscal year and that of fiscal 2010; its reinvigorated OEM relationships with IBM, HP and Dell; and its determination to increase its share of the Ethernet switching market — via its Foundry Networks acquisition — from the meager 2.3% it owns today.

Consider this from Oppenheimer & Co. analyst Ittai Kidron:

Brocade highlighted its relationships with IBM and Dell, both of which we expect to ramp in CY2H10. Even a small slice of the OEMs’ switching sales could provide a lift… We believe Brocade’s portfolio is well aligned to drive gains with customers needing to upgrade — 60%+ of Brocade’s customers anticipate a significant upgrade within three years… We come away from Brocade’s analyst day with stronger confidence in our thesis.

And this from UBS, which raised its sales and earnings per share estimates for the company after the Analyst Day:

Brocade offered investors an upbeat fiscal 2010 outlook, expecting sales growth of at least 16%. Industry end-market demand and Brocade’s order pipeline has continued to improve post its July quarter close… Brocade discussed sytems integrator networking opportunities (mkt in $7B range), as well as a new FCoE blade that may be inserted onto a DCX chassis.

It appears the battle for data center supremacy has only yet begun.

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